John Leech, head of automotive at KPMG UK, comments on today’s SMMT new car registration figures, which highlight that demand for new cars in the UK fell by 8.5% in May 2017.
He said: “The sharp fall in new car sales in May indicates that the peak in the UK new car market was in the first quarter of 2017. We should now expect to see a steady cooling of sales over the rest of the year and in 2018. UK consumer confidence for major purchases has been declining throughout 2017, as measured by GfK Nielsen, and the adverse changes to Vehicle Excise Duty applied in April 2017 are expected to dampen demand throughout the second quarter of 2017.
“Car manufacturers have switched their attention from the UK market to Europe in response to the sterling’s weakness and stronger consumer demand in the EU. German car sales were up 13% and French car sales were up 8%. We maintain our forecast for 2017 new car sales at 2.5 million, falling from the all-time record of 2.7 million in 2016.”
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