Although new car sales in the UK rose 2.5% in July, the Society of Motor Manufacturers and Traders (SMMT), an auto industry body, has reduced its expected total new car sales figures for 2024.
New car sales are now projected to be at 1.97 million units at the end of 2024, a drop from the 1.98 million units predicted in April. SMMT’s data shows that July 2024 was the best performance for a month since 2020, and marks two years of consecutive growth.
However, that growth was entirely sustained by the fleet sector, with SMMT reporting a 13% increase in registration to reach a 62% market share. Private demand has continued to drop, falling by 11.1% in July to account for just 36.2% of deliveries during the month, although this is partly due to the growing popularity of salary sacrifice purchasing.
The private share of the BEV market continues to fall, with 17.2% of sales to private buyers compared with 20.3% last year.
Mike Hawes, SMMT chief executive, said: “Two years of new car market growth against a backdrop of a turbulent economy is testament to the sector’s resilience and the attractiveness of the deals on offer. Weakening private retail demand, however, particularly for EVs and despite generous manufacturer discounts, is the over-riding concern.”
Electrified vehicle demand outpaced the overall market, accounting for four in 10 (42.0%) new cars registered in the month. Hybrid electric vehicle (HEV) uptake increased by 31.4% to achieve a 14.5% market share, while plug-in hybrids (PHEV) grew 12.4% to take 8.9% of registrations. Battery electric vehicle (BEV) volumes, meanwhile, were up 18.8%, resulting in an overall market share of 18.5%.
Transport decarbonisation needs to accelerate
According to SMMT, the pace of the transition needs to “increase significantly”, with zero emission vehicles mandated to comprise a minimum of 22% of brands’ new car registrations over the full year.
The latest outlook ‘priced in’ an interest rate cut announced last week, but the trade body says further cuts would be welcome, making new car purchases more accessible to more customers.
Hayes added: “More people than ever are buying and driving EVs but we still need the pace of change to quicken, else the UK’s climate change ambitions are threatened and manufacturers’ ability to hit regulated EV targets are at risk.
Achieving market transition at the pace demanded requires greater support for consumers and, with the all-important new numberplate month of September beckoning, action on incentives and infrastructure is needed now.”
Kim Royds, mobility director at Centrica, agreed, saying: “Without a doubt, tackling the inequality that exists between at home and public charging should remain a top priority. A large proportion of homeowners live without access to a driveway and therefore are restricted from unlocking the main benefits of going electric.
“Creating at home and kerbside charge point solutions with affordable charging costs must be high on the list for industry leaders and policymakers to ensure that nobody is left behind.”
So far, despite rumours that it will reinstate the 2030 ban on sales of new petrol and diesel vehicles, the Labour government has said little about the transition to zero-emission transport. Transport secretary Louise Haigh has promised to deliver “the biggest overhaul to transport in a generation”, with her five strategic priorities to include “delivering greener transport”.
