13 January 2014

Booming new car ‘sales’ in 2013 have stoked a lot of discussion in the trade and wider media about the accuracy of registration figures and their relation to actual new car sales. In other words, the amount of pre-registration.

But, there are two obvious questions about pre-registrations that seem to be overlooked. Firstly has the level of pre-registrations (and I’m looking at the broadest definition here) changed much in recent years? And secondly, what’s wrong with the practice anyway?

As yet, I’ve seen no evidence that pre-registration levels have changed much year-to-year – and we’re currently trying to put together some stats to prove that.

On the second point, I’m increasingly of the opinion that there’s nothing much wrong with the current level of pre-registration in the UK market, whatever that figure is (and I’ve seen believable estimates running from 5% up to near 20%).

There are at least a couple of reasons pre-registrations why aren’t a problem, and could even be a good thing. If it’s the manufacturer doing the pre-registrations, then the retailers get to buy prime used-car stock at a good price and then retail it with a margin.

If the retailer’s registering the car, then you’d have to hope that it’s with good reason; usually to hit a target that will result in a bonus that will more than cover any associated costs. And again this car then becomes a prime used-car that can be sold to a retail buyer.

In each of these scenarios, the end customer also gets a great deal. They may not be the first keeper, but they know the car is essentially new and maybe they’ve found their way into a motor they wouldn’t otherwise have been able to afford. So it looks good for both retailers and consumers. Even the manufacturers seem comfortable with the situation. After all, they’re the ones setting the targets and paying the bonuses.

The only assumption here is that my first point about the level of pre-registrations really is unchanged. Under this assumption it’s clearly sustainable. Yes, occasionally some retailers (and manufacturers) will misjudge and overindulge with disastrous consequences. But the industry, by and large, seems to be thriving with new and used-car sales doing very well.

Is this a fair judgement of pre-registrations? Tell me I’m wrong.

Tristan Young

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Tags: 2013 sales, accuracy, new cars, pre-registration, regisration figures