Will they or won’t they? Speculation is rife as to whether supermarket chain Asda is preparing to break into car sales.

Nick Agarwal, head of media relations at the chain, which is owned by US behemoth Wal-Mart, is keeping his cards close to his chest: “We used to sell Mazdas in the 1980s, but we’ve no plans to sell cars now.”

The rumours are still strong, however, and market watchers fully expect the highly competitive industry to seek a new arena for the battle for consumers.

Dave Leggett, editor of just-auto.com, commented: “The car retailing sector is heading for a shake-up, spurred by deregulation (the upcoming ending of selective distribution under EU ‘block exemption’) and the emergence of new retail groups, as well as online trading. The supermarkets are expected to expand their presence and I would be extremely surprised if Asda stayed out.”

Supermarket rival Sainsbury’s began selling cars to UK consumers last year.