There was more bad news for the UK automotive sector yesterday, as the latest new car sales figures showed that new car registrations slumped by 5.5% year-on-year in December 2018. The Society of Motor Manufacturers and Traders reported that over the course of last year, sales fell by 6.8% – the second annual decline in a row. There are several reasons for the recent poor showing, including model changes, regulatory upheaval and anti-diesel policies.
However, while these issues will probably iron out over time, the ongoing decline in consumer and business confidence as a result of Brexit will be a significant cause for concern. Of course, if the UK manages to achieve a smooth withdrawal from the EU, then the car industry could receive a much-needed boost, but this doesn’t look likely at present. So much hinges on the next few months, which surely explains consumer’s reluctance to splash out on a new car.
Sterling had a mixed day, as it fell back against the euro, but made some gains against the dollar. It is the fourth consecutive day of gains against the greenback and hit its highest mark of the year so far. The volatility that was a symptom of 2018 looks set to continue for some time yet. Today we have the Halifax house price index figures for December which are expected to show an improvement from the previous month.
