Dip in car sales provides few clues about Brexit fallout
New car sales dipped slightly in June after recording their best ever start to a year, as analysts get one more snapshot of how the UK economy is faring in the aftermath of the EU referendum.
The total number of vehicles registered in June fell by 0.8 per cent compared to last year, with a total of 256,000 purchases being signed off over the month, according to data published by the Society of Motor Manufacturers and Traders (SMMT) this morning.
It was only the second monthly decline since February 2012, but comes after the industry's best ever start to a calendar year, with 1.4m vehicles having been sold in 2016 so far – 45,000 more than at this point in 2015.
Car sales are seen as one of the best indicators of both consumer and business confidence since it is a big purchase of something which loses value fairly quickly, making it difficult to reverse in times of hardship.
Mike Hawes, chief executive of the SMMT said: "It is far too soon to determine whether the referendum result has had an impact on the new car market. The first six months [of 2016] saw strong demand at record levels, but the market undoubtedly cooled over the second quarter."
The number of cars purchased by businesses fell steeply in June, dropping by 25 per cent, but they make up such a small proportion of the total figures – around four per cent – this did not weigh too heavily on the headline figure.
A 4.5 per cent fall in sales to individuals was offset by a 4.5 per cent climb in fleet sales compared to June 2015.
Howard Archer of IHS Global pointed out that the fall in monthly sales comes after a run of very successful years for the motor industry, echoing its point that it is too soon to read anything about how the UK's vote to leave the EU will affect the sector from these figures. He did, however, suggest car makers would have "serious concerns that consumers will cut back on buying new cars" over the next few months.