John Leech, UK head of automotive at KPMG, comments on the car sales data released today by the Society of Motor Manufacturers and Traders (SMMT):
“UK car sales rose by 11.5% in January 2013 compared to January 2012, which is the eleventh consecutive month of year on year volume growth. With an increase in sales of 15.9% it continues to be the UK consumer who is powering this recovery, offset by a small decline in car buying by companies and fleet customers.
“The picture is very different across the English Channel. Germany saw new car sales drop 9%, France saw a 15% drop and Italy an 18% drop in January 2013. Car companies are therefore targeting the comparatively buoyant car market in the UK, with larger than normal discounts to keep factories busy.
“It also reflects a return to the new car market by customers who had switched to used cars during the recession. This may soon impact the UK’s used car market which has been booming and enjoying record high prices. Dealers and fleet managers need to take care that there may be a downwards price realignment in the used car market in 2013. I believe prices could potentially fall by as much as 5% over the next 12 months.”
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