(Updates with details and quotes)
LONDON, July 4 British new car sales recorded
their best first half to a year since 2005, figures showed on
Friday, but sales growth slowed in June as consumer demand
started to level off.
The Society of Motor Manufacturers and Traders (SMMT) said
new car registrations totalled 228,291 last month, up 6.2
percent on a year earlier.
In the first six months of 2014, registrations were nearly
1.3 million, a 10.6 percent rise on the same period in 2013.
"The overall market has risen faster than we were expecting
but, after a bumper March, growth is showing signs of
stabilising around our forecast level," said Mike Hawes, SMMT
Analysts say record low interest rates and a recovering
economy has given consumers the confidence to buy more big
But sluggish wage growth could be a challenge, in particular
if interest rates begin to rise. The Bank of England has
indicated this could happen as soon as this year.
"One concern for car manufacturers is that current muted
earnings growth threatens to be a constraint for car sales,"
Howard Archer, chief UK economist at IHS Global Insight said.
Sales slowed from an annual increase of 7.7 percent in May
and 8.2 percent in April, and Barclays - which provides
finance to car buyers and dealers - said it had seen anecdotal
evidence that this trend would continue.
Still, the SMMT said the market was on track for 2.4 million
new car registrations in 2014, up more than 6 percent on last
Ford's Fiesta supermini and General Motors'
rival Vauxhall Corsa were the two best-selling cars in June,
followed by Ford's mid-sized Focus and the Volkswagen
(Reporting by Ana Nicolaci da Costa, editing by John