Rover passes Ford as car sales ride high

MICHAEL HARRISON, Industrial Editor, The Independent

Friday, 8 January 1993

MOTOR industry leaders were cautiously optimistic yesterday that car sales will rise this year after the 37 per cent leap in registrations in December.

That increase pushed sales for the year to 1.593 million - pipping the 1991 total by a mere 1,300 - and brought forecasts that registrations this year could reach 1.7 million.

The sharp rise in registrations to nearly 80,000 in December means that sales have increased, year-on-year, in four of the past five months.

Although sales last year were still 31 per cent below the record level of 1989, recovery may at last be on the way after a painful period of job cuts and plant closures.

The marginal increase in annual registrations was welcomed by ministers and manufacturers as an indication that a key consumer market had at last turned the corner out of recession.

Sir Hal Miller, chief executive of the Society of Motor Manufacturers and Traders, described the figures as a 'considerable morale booster' for the industry. 'They reinforce our belief that the home market is on its way to recovery and we are confident that this will continue, on a more modest scale, throughout 1993,' he said.

Tony Nelson, Economic Secretary to the Treasury, also predicted that the car industry would start to recover this year: 'These figures suggest the measures taken to improve confidence, including the abolition of car tax announced by the Chancellor in his Autumn Statement, are starting to take effect.'

Car chiefs cautioned that it would be unwise to read too much into the figures for December because it is not traditionally an important month for sales.

Ford had a miserable 1992, its market share slipping by more than 2 percentage points to 22 per cent. Rover, by contrast, finished the year strongly, wresting market leadership from Ford for the first time in eight years with 25.5 per cent of December's sales.

Rover's strong performance last month was partly thanks to 4,000 employees at its parent company, British Aerospace, renewing their cars under a special purchase scheme. Its market share for the year fell from 14.4 per cent in 1991 to 13.5 per cent.

Vauxhall finished second with sales of 266,000 cars giving it a record share of 16.7 per cent.

Saturn, the subsidiary created by General Motors to compete with Japanese manufacturers in the North American small-car market, will break even on an operating basis this year, three years after selling its first vehicle, the company said yesterday. It should start to show a profit in 1994.