Credit crunch hits new car sales

The number of new car sales saw a sharp fall last month as the credit crunch continued to bite, new figures have revealed.

The Society of Motor Manufacturers and Traders (SMMT) said that a total of 153,420 new cars were registered in July 2008 - a 13% fall on the July 2007 figure. Meanwhile, the demand for alternatively fuelled vehicles rose by 19.4% over the month as consumers worried about costs and the environment.

"The July decline in total sales reflects the continued deterioration in consumer confidence being experienced across the economy," said SMMT chief executive Paul Everitt.

"Rising fuel and household bills, alongside falling house prices are making consumers reluctant to commit to new expenditure."

He added: "Vehicle manufacturers are doing their bit to support consumers. New cars are now 22% more affordable than they were 10 years ago and new technology is delivering more fuel efficient motoring.

"Industry needs the support of Government in order to encourage the uptake of lower-emitting vehicles and ultimately lower the cost of motoring for consumers."

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