March 2017 ‘will be the biggest car sales month ever’

Time 3:26 pm, January 6, 2017

A SALES flurry driven by buyers looking to beat the new vehicle tax changes will push March sales to record levels, believe industry bosses.

In April, the VED system changes to a more flat-rate approach – most notably it will penalise buyers of cars worth more than £40,000 and only offers a zero-rate fee to electric cars.

That means buyers of new hybrids and low-emitting diesel- and petrol-engined cars, which currently enjoy free VED, will no longer benefit from a discount, instead paying a flat rate of £140 per year.

Andy Barratt, chairman and managing director of Ford, which was the UK’s biggest-selling car manufacturer in 2016, says this March could be huge.

He said: ‘March has always been bigger than September in terms of actual demand, but with a very big tax change on April 1, I think that we will see the biggest single registration month in the history of the UK car industry in March.’

His views were echoed by SMMT chief executive Mike Hawes, who believes we will see a sales surge in March the likes of which the industry has probably never seen before.

‘We expect to see sales of cars costing more than £40,000 pulled forward as well as some others that will no longer benefit from free VED,’ said Hawes.

The tax changes are likely to also see a glut of pre-registrations take place as manufacturers and dealers look to register cars to beat the changes. These would then be held in stock and sold as ‘nearly new’, mitigating the expensive changes – especially on those cars costing more than £40,000.

Hawes added that he was disappointed with the VED changes as they had failed to incentivise buyers into swapping for lower-emitting vehicles.

‘We were disappointed with the proposals when they were announced by the then Chancellor George Osborne two years ago, because the incentive for ultra-low emission vehicles was effectively removed,’ he said.

James Baggott's avatar

James is the founder and editor-in-chief of Car Dealer Magazine, and CEO of parent company Baize Group. James has been a motoring journalist for more than 20 years writing about cars and the car industry.

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