Car sales fall slows as scrappage scheme helps

LONDON (Reuters) - New car registrations fell 15.7 percent on the year in June, the smallest decline in almost a year, helped by a government scheme to boost car sales, the Society of Motor Manufacturers and Traders said on Monday.

SMMT said the moderation was due to the government's scrappage scheme, which gives drivers 2,000 pounds to trade in cars more than 10 years old against a new model.

It said there were 176,264 new car registrations last month, compared with 209,190 in June 2008. June's annual fall compared with a 24.8 percent year-on-year decline in May and was the smallest since July 2008.

Demand from private buyers rose for the first time since November 2007, up 3.9 percent on the year. Small cars remained the most popular buy.

"We are now beginning to see the positive impact of the scrappage scheme translate into new vehicle registrations," said SMMT chief executive Paul Everitt.

"SMMT expects the pace of improvement to increase in the coming months, but we can already see the industry making steady progress on the long road to recovery."