Car sales stall amid credit crunch

The arrival of new number plate vehicles has failed to boost the new car market, official figures are expected to show.

The number of people taking out car insurance policies on new cars this month is likely to drop, despite the new 58 plates going on sale. The number of new registrations last month is thought to be considerably lower than the total of more than 419,000 in September 2007.

The September figures, which will be announced on Monday by the Society of Motor Manufacturers and Traders, follow a big drop in sales in August.

New car sales had been holding up well, compared with other consumer spending, until the last few months. The market has been fuelled by a series of tempting offers from manufacturers keen to shift stock.

But new car sales slipped 6.1% in June, and were down 13% in July. When August's new registrations tumbled 18.6% to 63,225, it signalled that the credit crunch had finally started affecting the motor industry.

The August sales were the worst figures since 1966, although until 1999 August was the new number plate month - with consequently swollen sales figures - before the motor industry decided to introduce new plates twice a year, in March and September.

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