The UK new car market witnessed its 21st consecutive month of growth in April, albeit at a modest 1.0% rise to 134,274 units. This, according to the Society of Motor Manufacturers and Traders (SMMT), marked the best April since 2021, but still fell short of pre-pandemic levels by 16.6%.
However, a concerning trend lurks beneath the headline growth. The sole driver behind this expansion was the fleet sector, with registrations surging by a significant 18.5% to 81,207 units. Conversely, private buyer uptake plummeted by a worrying 17.7% to 50,458 units, highlighting a potential consumer hesitancy.
Electrified vehicles, including plug-in hybrids (PHEVs), hybrids (HEVs), and battery electric vehicles (BEVs), remained the bright spots. PHEVs led the charge with a 22.1% growth, followed by HEVs at 16.7%. BEVs also saw a 10.7% increase, pushing their market share to 16.9%, a modest rise from last year’s 15.4%.
However, this BEV growth masks a crucial detail – it’s almost entirely driven by business purchases. Private BEV uptake actually dropped a concerning 21.9%. Industry experts point towards the lack of government incentives for private buyers as the primary culprit.
“While the overall increase in BEV demand is positive, urgent action is needed to re-enthuse private buyers,” said Mike Hawes, SMMT Chief Executive. “Fewer than one in six new BEVs bought in April went to consumers.”
Despite a vast array of BEV models with cutting-edge technology and attractive manufacturer offers, the absence of government support creates a significant barrier. The SMMT proposes measures like temporarily halving VAT on new BEVs and adjusting the expensive car supplement threshold for electric vehicles as potential solutions.
Furthermore, the current state of charging infrastructure is another hurdle. While 2023 saw record-breaking chargepoint installations, there’s still just one standard charger for every 35 plug-in cars on the road – a meager improvement from 2022’s ratio. This lack of readily available charging options discourages many potential EV buyers.
The combined effect of these factors is reflected in the revised 2024 market outlook. While the overall new car market is expected to grow by 4.2% to 1.984 million units, BEV projections have been downgraded by 5.2%. This translates to an anticipated BEV market share of 19.8%, falling short of the government’s target of 22% under the Vehicle Emissions Trading Scheme.
“The new car market continues to grow,” Hawes said, “but it’s primarily driven by fleet demand, and the absence of government incentives is impacting electric vehicle sales. Manufacturers cannot shoulder the burden of mass market transition alone.”
The SMMT urges the government to implement measures that incentivize private BEV purchases and accelerate the rollout of charging infrastructure. Such actions are crucial to achieve the UK’s net zero ambitions and foster a long-term, sustainable shift towards electric mobility.
