UK car registrations fall for third month

The market for new cars in the UK has declined for the third month in a row.

New car registrations fell by 4.8% in June compared to the same month last year, according to the Society of Motor Manufacturers and Traders (SMMT). In total of 243,454 vehicles were sold.

The SMMT said the market is "in line with 2017 forecasts" following a record first three months of the year.

Many buyers rushed to buy cars before 1 April to avoid a rise in Vehicle Excise Duty.

Some 1.4 million cars have been sold so far this year, down 1.3% on the same period in 2016.

Mike Hawes, SMMT chief executive, said: "As forecast, demand for new cars has started to cool following five consecutive years of solid growth but the numbers are still strong and the first half of the year is the second biggest on record.

"Provided consumer and business confidence holds, we expect demand to remain at a similarly high level over the coming months."

Rates of Vehicle Excise Duty explained

Sales of private, fleet and business cars were down, with falls of 7.8%. 2.4% and 8.3% respectively.

However, sales of small family cars and four-wheel drives grew 6% and 11.3% in June.

Tax exemption

Since 1 April, only newly-registered cars with zero emissions have been exempt from paying VED, which only includes electric and hydrogen cars. However, petrol cars with carbon dioxide emissions of up to 100g per km, registered before this date, are also exempt.

There is a sliding scale of charges for the first year of ownership, and after that petrol or diesel vehicles are subject to a "standard" rate of £140 a year.

For those buying cars costing more than £40,000 there is an additional £310 "premium" levy for the first five years of ownership.