NO surprise that new car sales fell, year-on-year, by 27% in November as many parts of the UK were subject to lockdown restrictions, and showrooms closed their doors to the public – and prospects for an uptick in sales in December are slim according to industry watchers
Michael Woodward, UK automotive lead at Deloitte, said that pent up demand is expected to be lower than after the first UK-wide lockdown, and many consumers will likely prioritise Christmas presents over other major purchases.
He added: “As the year ends, the industry continues to rely on aftersales and maintenance to get through this challenging time. The roll out of a vaccine is expected to lift consumer and business confidence, but the impact of this may not be seen until the New Year.
“In the final month of the year, attention is shifting firmly towards Brexit and its impact on automotive production in the UK. UK car production has fallen 44%, to less than one million, since 2017 and whilst sales are expected to rebound to pre-pandemic levels, concerns remain that production will not.”
Electric vehicles continued to outperform the rest of the market. Both battery electric (BEV) and Plug in hybrid (PHEV) vehicles saw year-on-year growth this month, of 122% and 77% respectively. Combined, electric vehicles grew their market share to 16%, up from 6% this time last year, and overtaking diesel’s 14% November share of sales by comparison. Whilst this shift has been distorted by the overall decline in sales, EVs actually increased their volume as well as their market share.
Woiodward said: “The recent announcement confirming the ban on new petrol and diesel vehicles by 2030 is likely to accelerate EV sales even faster. As an increasingly viable option for consumers, some may still need convincing that the necessary charging infrastructure is in place before we see any additional boost to the EV sector.
“Despite the ban being a decade away, many companies will already be thinking carefully about the implications to their fleet. There are already major financial and environmental benefits associated with transitioning to electric, but any wholesale change requires careful planning around infrastructure and operating models.”
Andrew Burn, Head of Automotive at KPMG UK, said: “Although car sales fell overall, the positive news is the continued advancement in hybrid and electric vehicle sales, with market share having grown to 36.9%, whilst diesel has fallen to 14%. With the recent government announcements around the 2030 targets, I expect this trend to continue and for market share to keep building.
“Looking ahead, carmakers will be hoping for a positive Christmas period to give the sector a boost prior to seeing the impact of Brexit in January.”
