Governments blamed for car sales slump

By Douglas Fraser
Business/economy editor, Scotland

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The motor trade in Scotland has suffered a steep decline in sales of new cars during March.

The fall provoked a strong attack on both national governments for leaving the industry with uncertainty about future regulation of diesel engines.

March is when dealers need to make much of their revenue from selling cars with the new number plates - this year '18'.

New registrations were down 21% on March last year. New diesel-powered cars were down 44%,

Much of that fall is thought to be due to buyer uncertainty about future regulation of engine emissions.

Tax change

The figures also reflect a drop in confidence among buyers, particularly of car fleets, with uncertainty about the future direction of the economy.

An additional factor was that the March 2017 figures were boosted significantly by the deadline for a car tax rise at the start of April last year.

UK new car registrations were down nearly 16%.

The drop in diesel brought sharp criticism of Westminster and Holyrood governments over their handling of the emissions issue.

Sandy Burgess of the Scottish Motor Trade Association said there is a need for politicians to "swallow a reality pill" about road transport.

He said sales of second-hand cars have gone up, including diesels, and that older cars, with higher emissions, are being kept on the road for longer.

'Clean and efficient'

"We have experienced a dramatic drop of in registrations year on year of almost 21%, that in a normal month would suggest that the market is cooling," he said.

"In the peak month of March it would tend to suggest that the market has gone cold. That said we do have to consider that the comparisons with last year's peak forced market as a result of impending taxation changes coming into force on April 1st 2017 are challenging at the very least given the anomaly of the situation and that coupled with the industry experiencing a reduction in new car buying across the UK.

"The Scottish market is still experiencing stronger retail share within the results than the rest of the UK, however there can be no doubt that the consistent negative messaging against modern clean and efficient diesel engine vehicles is having a hugely detrimental effect on the confidence of the consumers and Scotland's businesses."

He added: "This situation coupled with the extreme absence of information or guidance from our respective UK and Scottish governments as to what the intentions are for the future use of these vehicles around our towns and cities is creating the potential for a 'perfect storm' ultimately leading to older, less fuel efficient and dirtier vehicles being used for longer than intended in the process."