SMMT: New automotive market delivers greatest yr since 2019 as fleets gasoline development

Photo of author

By Car Brand Experts

[ad_1]

The UK new automotive market has recorded its greatest yr because the pandemic as a powerful December, up 9.8%, wrapped up the seventeenth month of consecutive development. 1.903 million new vehicles reached the street throughout 2023 – a rise of 17.9%, in line with the most recent figures from the Society of Motor Producers and Merchants (SMMT)

SMMT Car regs summary graphic Dec 23 01

The UK new automotive market has recorded its greatest yr because the pandemic as a powerful December, up 9.8%, wrapped up the seventeenth month of consecutive development. 1.903 million new vehicles reached the street throughout 2023 – a rise of 17.9%, in line with the most recent figures from the Society of Motor Producers and Merchants (SMMT).

Dec Sales 2023 and YTD cars

Development was pushed completely by fleet funding because the earlier yr’s provide constraints light and helped fulfil pent-up demand. Fleet deliveries rebounded by 38.7% yr on yr, whereas enterprise registrations, a small proportion of the market, fell by –1.5%. Non-public shopper demand remained steady at 817,673 models after a powerful restoration in 2022, with price of residing pressures and excessive rates of interest constraining development. Whereas the general new automotive market stays -17.7% beneath pre-pandemic ranges,1 the surge in uptake in contrast with the earlier yr noticed the worth of recent automotive gross sales bounce greater than £10 billion to round £70 billion, with 288,991 extra autos reaching the street.2

Annual registrations 2007 to 2023

By way of car kind, consumers confirmed a continued desire for superminis, twin objective and decrease medium vehicles, which accounted for 29.8%, 28.6% and 28.2% of the market respectively. These three segments have been the preferred since 2013.

Dec Fuel 2023 and YTD cars

Because the trade transitions away from fossil fuels, drivers continued to speculate closely in low and nil emission autos – which meant common new automotive CO2 fell by -2.2% to 108.9 g/km. Hybrid electrical autos (HEVs) recorded sturdy development, up 27.1% to achieve a 12.6% market share. Plug-in hybrids (PHEVs) additionally loved a powerful yr, with a 39.3% improve in registrations to account for 7.4% of the market.

Dec 2023 best sellers cars

Battery electrical car (BEV) uptake reached a document quantity – up by nearly 50,000 models with 314,687 new registrations. Certainly, 2023 noticed extra BEVs attain the street than in 2020 and 2021 mixed.3 BEV volumes really fell by -34.2% within the final month of the yr, however this can be a reflection of an irregular December 2022 when important numbers of orders had been capable of be fulfilled within the month.4 The following few months are additionally prone to be risky as a result of regulatory uncertainties which have beset the market over the previous few months – most clearly the last-minute deal on UK-EU Guidelines of Origin, which avoids tariffs on EVs however which has made planning tough.

FY 2023 best sellers BEV cars

Total, BEVs accounted for one in six new vehicles registered in 2023, with the bulk taken by enterprise and fleet consumers who profit from compelling tax incentives.5 In distinction, one in 11 non-public consumers selected a BEV.6 For the reason that finish of the Plug-in Automobile Grant in June 2022, the UK is the one main European market with no shopper BEV buy incentives – however it’s now additionally the one market with mandated minimal targets for brand new ZEV registrations.

With mainstream shopper demand flat, the trade is looking on authorities to help non-public consumers by halving VAT on new BEVs for 3 years. This momentary minimize would give non-public customers entry to fiscal help at a degree just like that loved by enterprise consumers, enabling producers to ship bigger volumes of zero emission autos. Mixed with a retention of the enterprise incentives which have already confirmed their worth in elevated EV uptake, the measure would speed up the UK’s market transition. Extra drivers would improve their present petrol or diesel automotive to a brand new zero emission various, widening the longer term provide of used electrical autos and making funding in chargepoint rollout much more compelling.

Over the previous 5 years, BEV uptake has risen nearly 20-fold, with the Treasury reaping a VAT windfall on account of these autos usually having increased buy prices than their ICE counterparts.7 Halving VAT would give customers an estimated extra £7.7 billion in BEV shopping for energy to the tip of 2026, whereas lowering the Treasury’s tax take by simply 22% per car for every extra driver switching from an ICE to a BEV. This may encourage an additional 270,000 new automotive consumers in Britain to go electrical and put 1.9 million new EVs on the street by the tip of 2026.8 Such a step would have a profound influence on the UK’s carbon footprint, lowering street car emissions by greater than 5 million tonnes cumulatively over the following three years.9

Mike Hawes, SMMT Chief Govt, stated,

With car provide challenges fading, the brand new automotive market is constructing again with the perfect yr because the pandemic. Energised by fleet funding, significantly within the newest EVs, the problem for 2024 is to ship a inexperienced restoration. Authorities has challenged the UK automotive sector with the world’s boldest transition timeline and is investing to make sure we’re a serious maker of electrical autos. It should now assist all drivers purchase into this future, with shopper incentives that may make the UK the main European marketplace for ZEVs.10

Waiting for 2024, the most recent market outlook – printed in November – anticipates 2024’s new automotive market to achieve 1.97 million models, with 439,000 BEVs taking a 22.3% market share. The following quarterly revised outlook will likely be printed in February.

1 2019 registrations: 2,311,140
2 Primarily based on JATO common worth (£36,474)
3 298,932 BEVs registered in 2020 and 2021
4 BEVs achieved a document market share of 32.9% in December 2022, making them the preferred kind of automotive for the month
5 BEV massive fleet and enterprise = 77.1% of BEV volumes (in contrast with 57% of general market)
6 8.8% of personal registrations are BEVs – 1:11.4
7 2018: 15,510 BEVs registered; 2023: 314,687 BEVs registered. JATO common BEV price: £47,471. Common ICE price: £30,483 (1H 2023)
8 Primarily based on SMMT evaluation – assumed 65% of the market would profit from a VAT minimize, lifting demand for that proportion by 25% (primarily based on 1% worth fall delivers 3% demand rise), elevating outlook for BEVs between 2024 and 2027 from a 1.67 million base to 1.94 million, a 270,000 unit rise
9 Primarily based on SMMT evaluation – 1.94 million X VAT saving (£3,956, primarily based on JATO common worth of BEV) = £7.7bn. CO2 saving primarily based on 1.5tCO2 saved per automotive pa by the 1.94 million new BEVs registered between 2024 and 2026.
10 As of the most recent obtainable ACEA European market information, for November 2023, the UK is the second largest European BEV market by quantity and sixteenth by market share

SOURCE: SMMT

[ad_2]

Leave a Comment

For security, use of Google's reCAPTCHA service is required which is subject to the Google Privacy Policy and Terms of Use.

Pin It on Pinterest

Share This

Share This

Share this post with your friends!