According to reports from the Society of
Motor Manufacturers and Traders, the number of new
vehicles in the UK slumped by 43 per cent during May, when
compared to stats from the year before. The drop took production
down to 67,754
cars . Meanwhile, production of
commercial vehicles dived by some 73.5%.
Many
companies have temporarily shut down their production or cut
back. The positive impacts of the
car scrapping scheme will take a while to filter into the
market.
The chief executive of the SMMT, Paul Everitt, reportedly
commented: Prompt action by manufacturers to realign supply
with demand has been painful, but was necessary. There is now a
direct link between demand in the marketplace and production
volumes. Businesses across the economy are still holding back on
new expenditure and will need to see better access to
finance and stronger domestic demand. The
scrappage schemes in place across
Europe are now beginning to have a positive impact, although
the full benefits will take a little longer to flow down to
companies at all levels in the supply chain.
