New car registrations in the UK rose for the first time this year in May, with a 1.1%, or 2,102 units, rise to 190,002.
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Industry market expectations were beaten by 3% cent or 5,000 units, according to the Society of Motor Manufacturers and Traders (SMMT).
While the market saw the first rise in May since 2002 it was still 2.2%, or 4,247 units, short of the 1999-2005 market average for the month.
Despite the rise in May, volumes were still down by 46,438 units, 4.3%, over the first five months of the year to 1,022,424.
Business registrations had their best performance of the year in May. However, the monthly gain failed to lead to a positive year-to-date growth.
Fleet volumes also rose in May, albeit more modestly than rise in the business sector.
The private sector saw another fall in volumes in May, but at a much reduced level; down just 2%.
The SMMT said the slight recovery in May was supported by government figures showing GDP growth posting its best quarterly performance since 2004.
“However, it is too early to tell if the economic setting is strong enough to support a lasting recovery in the UK’s new car market,” the trade group noted, adding: “There is some concern that the Bank of England may raise interest rates again in order to stifle inflationary pressures, which could take the wind out of any recovery in consumer spending.”
The SMMT said supermini segment volume posted an impressive recovery in the month, with sales up 6,955 units on their 2005 level. The MPV (minivan), luxury saloon and sports car markets also rose in May.
The Ford Focus remained the best selling model in the UK in both the overall and diesel markets for the month and year-to-date.
Diesel market share hit a record high for the month at 37.9%. Over the year-to-date, the diesel market share rose to 36.9% with the year-end forecast to hit 38%.
The annual running total for diesel registrations exceeded 900,000 units in May, after a 4% growth in the month.
The Ford Focus has been the best selling diesel model in every month of 2006.
