The new car market will continue to boom this year on the back of lower prices and strong consumer confidence, predicted auto retailer Reg Vardy as it posted record first-half profits.
Optimism was increased by an industry survey published yesterday which showed new cars were 2.2% cheaper in November 2001 than 12 months earlier.
"I believe that in the current economic climate the new retail vehicle market will continue to grow," said chairman Peter Vardy.
"I anticipate that many customers will opt out of company car schemes as the new CO2 emission legislation comes into force in April this year."
While some car manufacturers cut capacity in Britain the total number of new registrations rose 11% last year to a record 2.46m as the market absorbed pent-up demand created in 2000 when prices were considered too high.
This, in turn, boosted the Reg Vardy group, which saw its interim pretax profits rise by 61% to £15.2m for the period to October 31, while turnover rose 5.2% to £690m.
The company wants to double in size over the next three or four years and is looking at acquisitions but Mr Vardy is wary of forthcoming European Union rulings on the distribution of new cars. The block exemption agreement, which gives manufacturers control over who sells their cars, expires in September. Draft proposals should have come out three months ago and are expected any day now.
Vardy has between 4% and 7% of the British market in Ford, Vauxhall, Renault, Fiat, Nissan, Citroen and Volkswagon cars. It wants to push this figure up to 10%.
The scale of difficulties facing car manufacturers globally will be on show tomorrow when Ford is expected to announce 20,000 jobs cuts in the US. In Britain talks continue between unions and Ford subsidiary Jaguar over potential cuts to the workforce at Halewood on Merseyside.
