Car buyers face expensive 2010

Car buyers face higher prices in 2010 thanks to manufacturers raising list prices, VAT returning to 17.5 per cent and scrappage set to end by March 1.

Some buyers sought to beat the VAT increase in December resulting in sales being up compared to the same month in 2008. A total of 150,936 cars were registered in December 2009 compared to 108,961 for the same month in 2008 according to the Society of Motor Manufacturers and Traders (SMMT).

However, sales are still down for the whole of 2009 and have fallen to their lowest yearly total since 1995, despite reduced VAT and the £2000 scrappage incentive. The number of cars registered in 2009 was 1,944,999 with more than 300,000 of these coming from cash-for-scrap sales. However, this is still six per cent or 136,796 down on total cars registered in 2008.

Scrappage scheme orders were at 304,000 up to December 20 with the scheme likely to reach the March 1st 2010 cut-off date before using up the £400m set aside for it.

The major worry now though is how new car sales will be affected once the £2000 discount has ended. Without the scheme the amount of cars sold in 2009 would have been just 1.6 million for the year.

Ford was the biggest winner in 2009 with the Focus and Fiesta the top two sellers for the year. This is despite the fact the manufacturer put up prices four times across the year with the Fiesta costing more than £2000 than when it first went on sale.

With the Fiesta topping the sales chart for December as well as the whole of 2009, there appears to be a trend for buyers to downsize their car. In past years, it was the bigger Focus that topped the sales chart.

At the same time the Fiat 500 and Nissan Qashqai managed to stay in the the top ten sales for the second month running.

Buyers can still make more significant savings when they go for pre-registered models. A new Ford Fiesta 1.25-litre Zetec currently costs £13,530 down to £11,350 with scrappage, but Parker's found a pre-registered model for just £9700 with deals like this likely to increase in the coming months. 

If you're looking to buy a new car in 2010 then Parker's wants to know. We want your views on the VAT increase, the end of scrappage and continued price rises by manufacturers.

• The best selling cars in December (private and fleet registrations combined)

1 Ford Fiesta 7877 2 Ford Focus 7339 3 Vauxhall Astra 6268 4 Volkswagen Golf 5523 5 Vauxhall Corsa 4759

• The worst performing manufacturers in December (private and fleet registrations combined) 

1 Corvette -100.00% 2 Hummer -100.00% 3 Daihatsu -66.29% 4 Proton -65.12% 5 Ssangyong -30.56%