September car registrations – painting a true picture?
Motor Trader magazine, which focuses on dealer activities, has reported that last minute self-registration activity distorted the record breaking September plate change, with over a quarter of the month’s volumes being registered on the closing day of the month. But could the heady days of growing registration figures be over? Some analysts believe strengthening markets elsewhere could knock the UK market back.
The SMMT figures showed 403,136 cars registered in September, the highest figure since March 2008. Several trade eyebrows were raised at the figures as September is traditionally the smaller of the twice yearly plate-change months.
The trade body has now apparently confirmed that over a quarter of the month’s total registrations were registered on the last day. It also said an unspecified technical issue caused three days’ worth of cars, totalling over 109,000 units, to be registered on 30 September and confirmed the correct figure for the day was 65,000 units.
Industry analyst Karl Davis, managing director of Coachworks Consulting, told Motor Trader that a high percentage of these 109,000 units would be self-registrations prompted by dealers aiming to hit their Q3 targets. “It’s all about stiff Q3 targets and washing everything up to get to the maximum threshold. For many dealers this included a lot of self-registrations,” he said.
Davis said dealers, especially those representing volume brands, would have been targeting sales at the top end of their bonus limit, typically around 130 per cent, to help subsidise deals they had done over the course of the quarter. “If you don’t make a significant profit in September you’re snookered.”
Tony Whitehorn, the UK president and CEO of Hyundai, also warned the September market had been pushed by manufacturers. He commented, “It was a forced market. Why on earth should September be bigger than March? March is a far more dynamic month for the new plate and should naturally be bigger than September. What we’re seeing is a push in the market place. It concerns me that we may have reached a tipping point in September. You talk to dealers and they tell you there was a massive push.”
He also said the self-registration activity had negatively impacted the opening days of trading for this month. “In the first five days of October the market was down because dealers are having to retail those vehicles, having pulled people from October into September.”
Motor industry portrayed as economic saviour
The surge in car sales over the last 12 months has allowed the SMMT to portray the UK motor industry as a saviour of the UK retail economy.
However such hubris ignores the desperation of vehicle producers to dispose of vehicles at high discounts, the relatively easy credit market in the UK and a reaction against several years depressing talk of ‘austerity’ all providing a boost to demand. With the German economy strengthening it is clear that the best of the ‘good deals’ may have passed in the UK, as producers take advantage of pent up demand in Germany.