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UK new car sales fall

New car registrations were only 183,125 in June – 6.3 percent down from June 2010 and the twelth consecutive month of declining sales.

Figures released today by the Society of Motor Manufacturers and Traders (SMMT) show that the car industry is no longer able to hide behind the artificial stimulation that Labour's scrappage scheme offered.

Paul Everitt, SMMT Chief Executive, told the Telegraph: 'June new car registrations continued to perform in line with industry expectations with robust demand in the fleet sector and a relatively weak retail market. The balance of demand makes this a tough time for vehicle manufacturers and their dealer networks.

'Slow, but steady economic growth in the second half of the year should see volumes increase, although the overall market is still expected to be around 1.93 million units,' he added.

Howard Archer, Chief Economist at IHS Global Insight, chipped in thus: 'Going forward, the new car market continues to face a challenging looking environment, particularly with respect to private car sales.

'Indeed, it is evident that many consumers have become less willing or able to spend, on major items so they are likely to think long and hard about splashing out on a new car. High petrol prices are another factor likely to weigh down on car sales. Consumer confidence weakened in June and is very low compared to long-term norms, with consumers reluctant to make major purchases.'

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