New car registrations fall again in July with SMMT revising expectations

  • July recorded a nine per cent fall in new car registrations
  • It was the smallest drop this year, however
  • SMMT now expects 1.6m new cars to be registered this year and 1.89m in 2023
  • Nissan Qashqai was July’s top-seller; Vauxhall Corsa remains year-to-date best-seller

Time 9:39 am, August 4, 2022

July recorded the smallest fall in new car registrations this year, latest figures show.

The month saw a nine per cent decline compared with July 2021, with a total of 112,162 units being registered, new data published today (Aug 4) by the Society of Motor Manufacturers and Traders reveals.

July was the fifth month in succession where registrations fell, but it was the smallest fall recorded so far this year and showed the ‘resilience’ of the automotive sector, said the SMMT.

Ongoing supply chain issues, primarily a shortage of semiconductors, along with disruption caused by the Ukraine war and Covid lockdowns in China were to blame, said the organisation.

Registrations of private cars were all but identical to July 2021, but it was the fleet sector that bore the brunt of supply chain problems, with the number of cars being registered to large fleets falling by 18.2 per cent to 50,014 units.

In fact, private registrations in the year to date are now 3.7 per cent up on 2021 as manufacturers prioritise private buyers rather than fleets.

Registrations of pure-electric cars grew by 9.9 per cent to 2,243 units, and achieved a 10.9 per cent market share for the month.

The SMMT noted July 2022 was the weakest monthly uplift for pure-electrics since the pandemic, but growth in the year has reached 49.9 per cent to deliver a 13.9 per cent market share, showing ‘the volatility in the supply chain’, it said.

July was also a weaker month for hybrids, with registrations falling 6.7 per cent to take 12.2 per cent of the market, while plug-in hybrids fell 34 per cent, which cut their market share to 5.8 per cent.

The Nissan Qashqai was July’s best-seller having notched up 2,514 registrations. The British-built SUV was followed by its compatriot the Mini at 2,410 units, while the Hyundai Tucson came in third with 2,267.

The Vauxhall Corsa slumped to sixth place with 2,121 units while Ford didn’t feature in the top 10 list at all.

Toyota recorded two top-selling cars in July, with the new Aygo X sitting in ninth with 1,939 units and the Yaris in tenth with 1,811.

The Corsa remains the year-to-date best-seller, though, with 24,333 units, followed by the Ford Puma (20,006) and Nissan Qashqai (19,097).

Predictions revised downwards

Taking a look back over the past six months, the SMMT said it’s ‘unlikely’ the market will be able to recover from the loss in registrations and has therefore revised its full-year outlook to 1.6m units – a 2.8 per cent fall on 2021.

The organisation has also changed its 2023 estimate and believes some 1.89m new cars will be registered next year, rather than 2.02m, with plug-ins making up 27.8 per cent of the market.

SMMT chief executive Mike Hawes said: ‘The automotive sector has had another tough month and is drawing on its fundamental resilience during a third consecutive challenging year as the squeeze on supply bedevils deliveries.

‘While order books are strong, we need a healthy market to ensure the sector delivers the carbon savings government ambitions demand.

‘The next prime minister must create the conditions for economic growth, restore consumer confidence and support the transition to zero-emission mobility.’

What the industry says

Just as expected

Although the outlook still appears gloomy, in reality, you’d expect new car sales to drop over the summer months in the run-up to plate changes in September.

Add to that the continued chip shortage crisis, the ongoing war with Russia and low consumer confidence in the economy and it should be no surprise new car sales continue to decline.

EV sales are still weathering the storm – despite lengthy wait times of up to a year, there’s still growing demand to go electric and avoid rising fuel costs and any future expansion of clean air zones.

Alex Buttle, co-founder,

How long will customer patience last?

This was meant to be a year of recovery, but the industry is slipping ever further behind its disappointing, pandemic-restricted 2021 levels.

While the majority of car makers continue to make strong profits against this backdrop, global semiconductor shortages and rising manufacturing costs mean customers are suffering, both in terms of waiting times and rapidly escalating costs.

It is not clear how long their patience will last.

Jim Holder, editorial director, What Car?

Demand is much higher

Demand for new cars is a lot higher than these figures suggest.

The market problem is still one of supply as war in Ukraine and component shortages keep a lid on the supply of new vehicles despite a lengthy queue of would-be buyers.

Retailers still have backlogs of orders stretching back many months which they can’t fulfil yet, despite the best efforts of manufacturers. The genuine level of demand is hidden by the supply issues.

Ian Plummer, commercial director, Auto Trader

A bitter pill to swallow

Another month, another fall in new car sales. After June’s miserable sales figures – the lowest recorded in June for over a quarter of a century – July’s poor performance is a bitter pill to swallow.

The steadily improving sales of EVs are a rare crumb of comfort in a mostly grim set of sales data, and the second half of the year is off to a weak start.

However, the overall slowdown in sales does come amid some more positive signs of recovery in the supply of new cars for sale.

James Fairclough, CEO, AA Cars

Positives for electric and hybrid market

Production challenges, the cost-of-living crisis and rising energy bills are putting the brakes on consumer spending, with many either turning to alternative options, such as the used market, and many putting off buying a car completely.

Although the overall outlook appears to be bleak, there are positives for the electric and hybrid market. As entry costs come down, greener vehicles will continue to make up a larger proportion of sales.

The onus is on suppliers to ensure demand can be met and that suitable infrastructure is in place to cope with the rise in alternative fuel vehicles.

Lisa Watson, director of sales, Close Brothers Motor Finance

Cost of manufacture likely to rise further

Whilst some supply shortages are gradually easing, new car production volumes remain constrained.

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Despite the cost-of-living crisis, UK demand for new cars continues to outpace supply, with long wait times for many models.

But rising energy costs will further test consumer ability to purchase new cars in the remaining months of the year, including electric vehicle adoption appetite. The cost of manufacture will also likely rise further, along with prices.

Richard Peberdy, UK head of automotive, KPMG

James Batchelor's avatar

James – or Batch as he’s known – started at Car Dealer in 2010, first as the work experience boy, eventually becoming editor in 2013. He worked for Auto Express as editor-at-large and was the face of Carbuyer’s YouTube reviews. In 2020, he went freelance and now writes for a number of national titles and contributes regularly to Car Dealer. In October 2021 he became Car Dealer's associate editor.

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