The UK's new car market returned to growth in May, as
registrations rose 1.6% to 150,070 units, according to the latest
data published today by the Society of Motor Manufacturers and
Traders (SMMT). It was the best May performance since 2021, but
still -18.3% lower than in pre-pandemic 2019 and only the second
month of growth this year, reflecting brittle consumer confidence
and economic turbulence.1
Fleets and businesses drove the growth, up 3.7% and 14.4%
respectively and responsible for 62.6% of registrations, while
interest from private buyers fell for the second consecutive
month, down -2.3%. There were double digit declines in deliveries
of both petrol and diesel cars – down -12.5% and -15.5% – while
demand for the latest electrified models increased dramatically
to take a combined 47.3% market share.
Uptake of hybrid electric vehicles (HEVs) grew by 6.8% to 20,351
units, while plug-in hybrid electric vehicles (PHEVs) were up
more than half (50.8%) to 17,898. Registrations of battery
electric vehicles (BEVs), meanwhile, rose by 25.8%, accounting
for 21.8% of the market as manufacturers continued to support
sales with attractive incentives.
Despite this, BEV registrations year-to-date have only reached
20.9% market share – still seven percentage points off the 28%
mandated by regulation. Moreover, significant discounting is
still ongoing despite new model introductions and increasingly
affordable offerings. While recent adjustments to the ZEV Mandate
were welcome, the current market situation is unsustainable for a
sector already facing multiple cost pressures.
Manufacturers are investing billions to deliver zero emission
mobility for all, and consumers are responding but not in the
volumes needed – so industry calls on government to match this
commitment with fiscal incentives. Halving VAT on new EV
purchases would put 267,000 additional new EVs – rather than
fossil fuel vehicles – on the road in the next three years and
drive down CO2 emissions by six million tonnes a
year. Removing EVs from the VED Expensive Car Supplement,
meanwhile, and equalising VAT paid on public charging to that
levied at home would send a signal that now is the time to
switch.
Mike Hawes, SMMT Chief Executive, said, “A
return to growth for new car registrations in May is welcome
but manufacturer discounting on new products continues to
underpin the market, notably for electric vehicles. This cannot
be sustained indefinitely as it undermines the ability of
companies to invest in new product development – investments
which are integral to the decarbonisation of all road transport.
Next week's Spending Review is the opportunity for government to
double down on its commitments to Net Zero by driving demand
through fiscal measures that boost the market and shore up our
competitiveness.”
Latest data shows the breadth of vehicle powertrain choice now
available, with sustained investment by manufacturers into
product development, meaning car buyers can choose from more than
135 BEVs – up from 106 last year – while there are also just over
100 PHEVs and nearly 50 HEVs.2 The average BEV is
capable of driving almost 300 miles on a single charge and, for
those keen to cut their emissions but not quite ready to go fully
electric, the average PHEV electric-only range is just under 50
miles. Some PHEVs offer as much as 88 miles of zero emission
motoring, while HEVs can also travel in electric mode with zero
emissions at low speeds.
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Notes to editors
1: May 2021 new car registrations 156,737 units, May 2019
was 183,724 units
2: SMMT analysis of new car registration data
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