UK new car sales fall 40% in January as lockdown bites | Automotive industry
According to industry figures released on Thursday, just over 90,000 new cars were sold in the UK in January, the slowest January in more than 50 years.
Revenue declined 40% to 90,249 compared to January 2020 as the closings of dealerships that were on hold exacerbated the economic crisis.
The Society of Motor Manufacturers and Traders (SMMT) said the start of “click and collect” sales prevented an even bigger decline, but could not prevent the worst start to a year since 1970.
The SMMT predicts sales will rebound slightly in 2021 from 2020, but said the industry will face a very subdued and challenging year, with showroom closings depressing demand and output. Last year, new vehicle sales fell by 29% to 1.63 million vehicles, the lowest level since 1992.
Mike Hawes, CEO of SMMT, said: “After losing £ 20.4 billion in sales last year, the auto industry is facing a difficult start into 2021.”
He said the UK lockdown was necessary but would “challenge society, the economy and the ability of our industry to work swiftly toward our ambitious environmental goals”.
“Every day that showrooms are safe to open will play a role, especially as the critical month of March approaches,” he said. The highest monthly vehicle sales are usually recorded in March when the license plate changes, which is almost a fifth of annual registrations.
National Franchised Dealers Association executive director Sue Robinson said retailers are optimistic for the coming year if the dealers can reopen as soon as possible. “Revenue is likely to be fueled by pent-up demand, rising registrations of low-emission and zero-emission vehicles, and the increasing importance of car ownership,” she said.
Lenders said the effects of Brexit were also showing. Close Brothers Motor Finance General Manager Seán Kemple said, “Ford has raised prices on some models due to the nature of their global production lines and there is a risk that other manufacturers will follow suit.”
Diesel vehicles continued to fall out of favor, accounting for only 12% of new cars sold in January. Electric car sales rose more than 50% to 6,260. At 40, there were almost twice as many models in the UK market as at the beginning of 2020. Battery-only and plug-in hybrid models together accounted for almost every seventh car sold.
Auto Trader’s commercial director Ian Plummer said sales of greener vehicles were still not a significant volume. “The plethora of new electric vehicles now in the market offers consumers some excellent options, but the high prices prevent many from converting interest into buying,” he said.
According to SMMT, the CO2 emissions of new cars sold in 2020 were an average of 112.8 g / km, 11.8% lower than in the previous year, but the pace of environmental improvement could “not slacken”. The industry must achieve an average UK fleet target of 95 g / km this year or face high financial penalties.