New car registrations fell 15.7% in June

The new car market posted its smallest decline since July 2008, at -15.7%, in June, according to the the Society of Motor Manufacturers and Traders (SMMT).

The scrappage scheme will have a positive impact on volumes, although the impact is likely to be lagged. SMMT had expected the market to decline to 153,000 units (as forecast in April), with the actual being 15% higher at 176,264 units.

Registrations to private buyers rose for the first time since November 2007 in June, up 3.9%.

Demand for small cars also picked up, with the mini segment showing growth of 145.4% in the month, while superminis took a record 37.2% share of the market. Ford’s Fiesta was the best selling model for a fifth time this year.

The growth in small car demand contributed to the fall in diesel penetration, with small cars tending to be petrol powered. However, diesel market share is still up over the year-to-date.

The market remains down 25.9% or 322,524 units over the first half of the year. Volumes in quarter two were down 21.2%, marking a sixth successive quarterly decline. SMMT is due to review and revise its full year forecast later this month.

The average new car CO2 emissions fell to 152.3g/km in the first half of 2009, this was 3.6% below the 158.0g/km recorded in full year 2008 and 19.8% below the 1997 level.

Paul Everitt, SMMT chief executive, said: “We are now beginning to see the positive impact of the scrappage scheme translate into new vehicle registrations.

“SMMT expects the pace of improvement to increase in the coming months, but we can already see the industry making steady progress on the long road to recovery.”