Increased demand from private buyers provides some new car cheer

INCREASED demand for new cars from private consumers was one of the highlights of the January new car registration figures, according to the National Franchised Dealers Association.

Sue Robinson, director of the NFDA, which represents franchised car and commercial vehicle retailers in the UK, noted: ‘The new car market remained stable in January, with a small decline of 1.6 per cent, supported by increases in private demand and sales of alternative fuel vehicles.

‘Positively, sales of alternative fuel vehicles grew substantially in January and we expect the sector to perform well throughout 2019 as new models enter the market and the current ones become more affordable.

‘It is encouraging to see that demand from private consumers grew by 2.9 per cent. With different types of vehicles coming to the market and new emission figures available, retailers have an important role to play in informing consumers and helping them choose the right car.

‘The retail automotive industry is flexible and resilient, but we urge the government to provide clarity to businesses and consumers as soon as possible.’

Really impressive

Ian Gilmartin, head of retail and wholesale at Barclays Corporate Banking, said: ‘There are some bright spots in the new car data with the first increase in private sales since August and a really impressive 26 per cent rise in alternatively fuelled vehicles.

‘However, the celebrations in the showrooms will be fairly muted, as although consumer purchases held up it wasn’t enough to prevent an overall decline.

‘As Nissan made clear at the weekend, a lack of clarity around Brexit is hurting UK vehicle manufacturing, but it’s also affecting car sales. Dealers have been holding out hope for some certainty, or at least a clearer route to certainty, on Brexit plans being in place before the new plates hit the road in March. That now looks pretty optimistic, and it could be that the most important month for the new car sector is falling at the worst possible time, so the car industry will want to see some progress in the very near future.’

Alex Buttle, director at the car buying comparison website Motorway.co.uk, said: ‘The latest SMMT data suggests it’s finally the year hybrid and electric sales will take off, but it’s unfortunate that such positive growth in AFV sales is continually overshadowed by plummeting diesel sales figures.

‘Unfortunately, while the AFV market is showing impressive and consistent green shoots, the number of units being sold is nowhere near high enough to compensate for the slump in diesel. There will come a point in the future when momentum will swing firmly in favour of electric, and offset the impact of falling diesel sales, but that feels a fair way off at the moment.’

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