Recently we reported how the British car industry had bucked the down trend and how car sales were up for the first time since the 2008 recession as were . This has been good news, however the European downturn, especially in Germany has sent reverberations through Britain’s car manufacturing industry.
The British Situation
This September, 128,192 cars were made in the UK which is a 5.8% fall on the production figures from 2011 according to the Society of Motor Manufacturers and Traders. Last month, Commercial Vehicle production fell even more, dropping down 20% from the previous year. Engine production was down 13% from last year to just over 213,000 units.
The German problem
Much to blame for this has been the fall in car sales in Germany. Germany forms almost a quarter of European car sales but reported a drop of 11% in September compared with last September. This is despite many substantial discounts promoted by Mercedes and VW who hardly ever need to take such action.
Pre Reg Problem
In the UK a third of new cars sold are actually pre reg as they are substantially discounted. The practice which is common here but unusual in Germany, is shown to have become more popular there. If we take this into account, we can surmise that very few new cars are actually sold at list price, meaning that the figures are probably much worse than previously thought. Car insurance companies have nothing to worry about though, there are still as many drivers renewing, just a slightly ageing national fleet.
There have been suggestions to cut pre reg discounts and simply offer all cars at a discount as Nissan do with their new car. If all you are looking for is a quick buck, then maybe that’s the way. This sort of suggestion doesn’t however tackle the more profound economic problems which so plague Europe and the West, economic problems which need time to be resolved ubiquitously.
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