06 Nov 2009
Car sales surge on scrappage extension and rush to save on VAT

New car sales jumped by 32 per cent in October as buyers rushed to take advantage of the Government’s “cash-for-bangers” scheme and beat a January increase in VAT.

The leap in sales was the biggest year-on-year increase this year and the fourth consecutive monthly increase in sales.

The vehicle scrappage scheme, introduced in May, accounted for a fifth of new car purchases, according to the Society of Motor Manufacturers and Traders.

About 168,942 new cars were registered last month, up from 128,352 the year before, as sales of vehicles to private buyers increased by 86 per cent to 89,532.

However, sales of fleet cars decreased by 2 per cent to 74,445 because company cars are rarely old enough to qualify for the government scrappage scheme.

Only cars that are at least ten years old can be traded in for a £2,000 discount on a new model.

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