December car market falls, but not as far as expected

New car registrations fell 21.2% in December to 108,691 units taking the full year total to 2,131,795 units from 2,404,007 in 200 – down 11.3%. Meanwhile, diesel market share reached an all-time high of 43.6% and average new car CO2 fell by a record 4.2% to an average of 158.0 g/km in 2008, a total reduction of 16.8% since 1997. Paul Everitt chief executive at the Society of Motor Manufacturers and Traders said the global economic downturn, precipitated by the crisis in the international banking and finance sector, had created unprecedented challenges for the UK automotive industry in 2008. “The measures taken by government to support the banking sector and kick-start demand have been necessary, but are not yet sufficient to restore confidence,” he said. “Further action to ease access to finance and credit across the economy is essential if long-term damage to valuable industrial capability is to be avoided.” Everitt said 2009 would be another difficult year for the industry with new vehicle registrations and production significantly reduced. He went on: “The industry faces these challenges stronger and more resilient than in recent memory. The extraordinary circumstances we currently face mean that government support will be required to take advantage of global economic growth when it returns.” The figures also prompted CBI Director-General Richard Lambert to call for help on behalf of the industry. “The automotive sector is a vital and viable part of our manufacturing industry,” he said. “With credit markets still frozen, the government needs to step in to get credit moving across the whole of the economy, and the needs of the automotive sector are especially urgent. “We are not calling for a bail out, but for short-term help to get car-makers through a difficult time. Otherwise, this crucial part of the economy will incur lasting damage.”