UK new car market reports 11-month run of growth

London – The UK new car market increased by nearly 26% year-on-year in June, marking 11 consecutive months of growth, figures from the Society of Motor Manufacturers and Traders (SMMT) show.

With 177,266 vehicles registered, the industry has 'gradually overcome' the pandemic-induced supply-chain shortages that constrained production for almost two years, SMMT said 5 July.

Furthermore, waiting times are easing and pent-up demand is being met, said SMMT, describing the automotive sector as “a rare bright spot in a gloomy economic landscape.”

Overall UK market volumes, however, remain below pre-pandemic levels of 2019, which saw 223,421 units registered in June.

Growth last month was driven predominantly by large fleet registrations, which were up 37.9% at 92,699 units, reflecting “the normalisation of supply”.

Private demand grew more modestly: up by 14.8% year-on-year to 79,798 units.

Deliveries of petrol cars increased 22.7%, to remain the most popular powertrain, though demand for hybrids (HEVs) and plug-in hybrids (PHEVs) rose by 40.1% and 65.5% respectively.

Diesel registrations were down 13.5% year-on-year, while battery electric vehicle (BEV) registrations were up 39.4% as 31,700 new cars were registered.

Over the first six months of 2023, almost a million (949,720) new cars joined UK roads, with total registrations up 18.4% year-on-year.

BEV-uptake reached record levels, with 152,968 deliveries so far this year – nearly 13 times greater than the same period in 2019.

Overall, the BEV market-share for 2023 stands at 16.1%, well below the zero emission vehicle mandate requiring 22% BEV registrations per manufacturer by 2024.

To accelerate the transition, the UK automotive industry is now calling for a cut in value-added tax on public charging points to help quicken uptake.

“Drivers able to charge at home pay just 5% VAT to power up their EV, compared with 20% for those without access to a driveway or designated private parking space,” said SMMT.

Taxing equity, it went on to say, would make switching to an electric vehicle feasible for more people regardless of home ownership or property status.