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Continued car sales slump expected

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Official figures are expected to show that the decline of new-car sales is continuing.

The Society of Motor Manufacturers and Traders (SMMT) is due to release figures showing new-car purchases for February this year and it is expected they will be well below last year`s sales.

According to the SMMT, there was a 30.9% decrease in new registrations in January on the same month last year following big year-on-year falls in the last months of 2008.

The group has predicted the new car market will decline by 19.3% in 2009, with just 1.72 million sales, 410,000 fewer sales than in 2008 and almost 685,000 down on the 2007 total.

The Government has been under pressure from industry bosses and union leaders to offer support to the struggling industry after car production has been cut back and jobs lost.

In response it announced it was activating the £2.3 billion of loan guarantees for the motor industry announced in January in a bid to boost sales.

Although SMMT chief executive Paul Everitt welcomed the move, he said the need for short-term measures to kick-start demand in the market remained critical.

© Press Association 2009