New car sales figures out today will bring little in the way of good news to Britain’s automotive retail industry.
Not only did the private sales market continue two years of decline, but fleet sales also dropped, contributing to an overall slide in the market of 6%.
In total 144,288 new cars were registered, according to the latest figures from the Society of Motor Manufacturers and Traders (SMMT).
The fleet sector, which has been a continuing bright spot in two years of sliding private sales figures, saw registrations of 86,701 vehicles, down 1.7% compared to October 2023, helping to record the second overall fall in the market in 2024.
Private car purchases were down by some 11.8% – fewer than four in 10 (38.8%) of new cars registered in the UK over the first 10 months of 2024 have gone directly to private buyers.
The only bright spot in the figures was a continuing rise in battery-electric (BEV) sales – registrations were up 24.5% to claim close to 21% of the overall market. Petrol and diesel registrations slid 14.2 and 20.5% respectively, while hybrid and plug-in hybrid sales also stuttered, down 1.6% and 3.2% even before much less attractive benefit-in-kind tax rates were announced in the Budget on 30th October.
Commenting on the figures the SMMT stated that while the average BEV has a higher upfront cost than a combustion-engined equivalent, widening choice and huge manufacturer discounting mean that around one in five BEV models now has a lower purchase price than the average petrol or diesel car – a factor that itself is causing issues in the fleet and leasing market with longer-term concerns over residual values.
The SMMT added that while almost 300,000 new BEVs have reached the road in 2024, the 18.1% of the market they represent is still significantly short of the 22% target for this year under the terms of the Government’s Zero Emissions Vehicle Mandate.
Vehicle Excise Duty and Company Car Tax changes in the Budget were criticised by the SMMT as disincentivising low-carbon vehicle purchases and fleet renewal generally, risking a delay to the overall reduction in road transport emissions.
“Massive manufacturer investment in model choice and market support is helping make the UK the second largest EV market in Europe – that transition, however, must not perversely slow down the reduction of carbon emissions from road transport,” commented SMMT chief executive Mike Hawes.
“Fleet renewal across the market remains the quickest way to decarbonise, so diminishing overall uptake is not good news for the economy, for investment or for the environment. EVs already work for many people and businesses, but to shift the entire market at the pace demanded requires significant intervention on incentives, infrastructure and regulation.”
Sure Robinson, chief executive of the National Franchised Dealers Association (NFDA), which represents franchised car and commercial vehicle retailers in the UK, described the figures as “particularly worrying” and “highlighting the volatility of the market right now”.
The October dip follows a slide in August after two years of continuous growth. “Both private demand and fleet saw declines this month,” Robinson said.
“Although the Chancellor acknowledged the significance of electric vehicles in the Autumn Budget, such as maintaining current incentives for EVs in company car tax, investment in charging infrastructure is also vital to drive demand further,” she added.
“Last week’s Autumn Budget had some bright spots notably with the fuel duty freeze, but there are still areas of concern, particularly the rise in employers’ national insurance from 13.8% to 15%, starting in April 2025. Notably, in the Budget, the Government also reaffirmed their commitment to phasing out new internal combustion engine cars by 2030.”
