Page last updated at 10:07 GMT, Thursday, 4 March 2010

UK car sales see continued recovery

A Toyota Avensis rolls off the production line at the company's Burnaston plant in Derbyshire
The SMMT says the scrappage scheme is still helping sales

UK car sales in February were up by 26.4% compared with the same month last year, according to the Society of Motor Manufacturers and Traders (SMMT).

There were 68,686 new cars registered last month and private buyers led the growth in sales.

"Scrappage has generated eight consecutive months of growth," said the SMMT's chief executive Paul Everitt.

Demand for smaller cars is still rising. The most popular this year are the Ford Fiesta and the Ford Focus.

Toyota's sales in the UK in February were up 15% on last year to 3,439 vehicles, despite the problems caused by the carmaker's global recall of more than eight million cars.

However, its share of new car sales dropped from 5.5% to 5%.

'Subdued' outlook

"Compared with last year, the industry is off to a strong start in 2010," said David Raistrick, automotive partner at Deloitte.

"However scrappage has only boosted the private buyers' market and we now need to see an improvement in the fleet market in order for growth to be sustained."

The UK's scrappage scheme is due to finish this month, but its impact could continue for some while.

New cars ordered before the scheme ends might not be delivered - and therefore registered - until June or even July.

The scheme, which pays motorists £2,000 to trade in an old car for a new one, accounted for almost one in five car sales in February.

Sales of new cars in March are also likely to be boosted as new registration plates come out this month.

The SMMT said that it expected to see some market decline in the second half of 2010 and predicted an overall decline in 2010 of 10%.

"With economic recovery still fragile and uncertainty over the impacts of the Budget in March and a general election in spring, the outlook is subdued," the SMMT said.

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