New Car Slump Continues

Tue 12th Apr 2022

Last month proved to be a watershed moment for the UK car industry with the news that new car registrations fell to their lowest level since the country moved to a twice-yearly plate change in 1998.

Sales fell by 14.3 per cent in March 2022, with production volumes down considerably, mainly down to the lack of semiconductor chips.

Some may see the continued boom in EV and BEVs as a high point of the latest report from the Society of Motor Manufacturers and Traders, however even the 78.7 per cent rise on the previous March is tempered by the fact that manufacturers are prioritising the production of EVs as they are low emission and high margin.

On the back of the continued interest in electric vehicles, Tesla have enjoyed another good year so far, with 6,464 registration of the Model Y and 6,457 of the Model 3 in March, though insiders point out that Tesla generally load their deliveries to the end of a quarter. Even so, Elon Musk will be delighted to hear that his vehicles are currently the two hottest selling models in the UK.

At the other end of the emissions argument, diesel sales fell by 55.2 per cent, petrol by 25.5 per cent and PHEV by 7.5 per cent. Overall there were 243,479 cars sold in March.

“March is typically the biggest month of the year for the new car market, so this performance is deeply disappointing and lays bare the challenges ahead,” said Mike Hawes, SMMT Chief Executive. “While demand remains robust, this decline illustrates the severity of the global semiconductor shortage, as manufacturers strive to deliver the latest, lowest emission vehicles to eagerly awaiting customers. Placing orders now will be beneficial for those looking to take advantage of incentives and lower running costs for electric vehicles, especially as the Ukraine crisis could affect supply still further. With increasing household and business costs, government must do all it can to support consumers so that the growth of electric vehicles can be sustained and the UK’s ambitious net zero timetable delivered.”