Seven per cent drop in new car registrations is unsettling, says SMMT

Time 9:12 am, February 5, 2020

THE UK new car market declined 7.3 per cent in the first month of 2020, according to figures published today by the Society of Motor Manufacturers and Traders.

A total of 149,279 vehicles left showrooms in January, as confusion surrounding diesel and clean air zones and ongoing weak consumer and business confidence continued to affect demand.

Ongoing low consumer demand was a key driver behind the decline, with registrations by private buyers down 13.9 per cent, while fleet registrations also fell but by a less significant 2.2 per cent.

Registrations of new diesel cars fell for the 34th month, by 36 per cent, to record the weakest performance since 2000 and just a 19.8 per cent share of the market, while petrol demand also declined, by 9.5 per cent.

Alternatively-fuelled cars, however, continued to grow in popularity. Hybrid electric cars (HEVs) increased by 20.6 per cent, with 8,941 hitting British roads, and plug-in hybrid electric vehicle (PHEV) demand more than doubled, up 111.1 per cent to 4,788 units.

Battery electric vehicle (BEV) registrations, meanwhile, continued to surge, up 203.9 per cent to 4,054 units with a 2.7 per cent market share. Combined, alternatively-fuelled vehicle registrations reached 11.9 per cent of the market in January – the highest percentage on record, up from 6.8 per cent in the same month last year.

The figures come a day after the government announced its ambition to end the sale of all vehicles with an internal combustion engine, including HEVs and PHEVs, by 2035.

Mike Hawes, SMMT chief executive, said: ‘The new car market is a key driver of the UK’s overall economy, so another month of decline is unsettling. Consumer confidence is not returning to the market and will not be helped by the government’s decision to add further confusion and instability by moving the goalposts on the end of the sale of internal combustion engine cars.

‘While ambition is understandable, as we must address climate change and air-quality concerns, blanket bans do not help short-term consumer confidence.

‘To be successful, the government must lead the transition with an extensive and appropriately-funded package of fiscal incentives, policies and investment to drive demand. We want to deliver air quality and environmental improvements now but need a strong market to do so.’

MORE: 2019’s new car market sinks to lowest level for six years

MORE: Record demand for alternatively fuelled cars in November but overall UK market falls

MORE: New car market continues downward trend as buyer confidence wanes

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Car Dealer has been covering the motor trade since 2008 as both a print and digital publication. In 2020 the title went fully digital and now provides daily motoring updates on this website for the car industry. A digital magazine is published once a month.

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