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New and used car sales 'strong in 2009'

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The new and used car market was particularly strong during 2009, according to the Retail Motor Industry Federation.

However, the group believes that forecourts should prepare themselves for the possibility of new and used car sales tailing off in the new year when VAT rises come into force.

Sue Robinson, director of the group, commented that increases in consumer finance outlined for October by the Finance and Leasing Association show that the new and used car market was especially robust through the first quarter of 2009.

"Point of sale finance has been particularly critical in helping consumers return to the market as other forms of finance, like personal loans have been in short supply at competitive rates," she added.

Ms Robinson went on to say that increased VAT, the removal of scrappage incentives and constricted disposable income are likely to hit vehicle sales at the start of 2010.

In his pre-Budget report earlier this month, chancellor Alistair Darling confirmed that the standard rate of VAT will return to 17.5 per cent on January 1st.ADNFCR-2576-ID-19520866-ADNFCR

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