David Prosser: How long can car sales stay in the fast lane?
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.Outlook At last, some good news on the economy, where all the data of the past few days has been fuelling double dip fears. The SMMT's figures for car sales during June were unexpectedly buoyant, with better fleet sales more than compensating for the fall-off in trade from individual drivers we have seen since the end of scrappage.
The question, however, is how long that positive message will endure. The motor industry itself expects to see sales slipping back during the second half of the year – not least because business confidence surveys suggest optimism is now faltering, so fleet spending is likely to fall back once again.
Then, in the new year, the industry will have to begin contending with the higher rate of VAT, which could be a real issue. When Alistair Darling temporarily cut VAT in 2009, there was a great deal of sniping about the effectiveness of the gesture in terms of boosting consumer spending.
But on big ticket items such as motor cars, the savings were quite noticeable to customers and the VAT cut prompted a decent sales uplift from day one. There is no reason to think the reverse won't be true when VAT rises to 20 per cent on 4 January 2011.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments