New Car Sales suffers worst June performance since 1996 as supply shortages continue to bite

Purley Automotive News - July 2022

The UK automotive industry suffered its worst June for new car sales since 1996, according to figures released today by the SMMT.

Registrations of new cars fell by 24.3 per cent last month versus June 2021, with just 140,958 new vehicles registered.

Worldwide shortages of components such as semiconductors continued to hamper manufacturers’ ability to fulfil demand, the trade body said.

Drivers are having to wait more than 12 months for delivery of some models, it added, and only 802,079 new cars were sold during the first half of the year.

That was an 11.9 per cent reduction compared with the same period in 2021 – the industry’s second weakest January-June performance since 1992, when 768,745 new cars were registered.

In addition, some 107,894 fewer new cars were registered during the first half of 2022 versus the same period last year – despite demand in 2021 being restricted by dealership lockdowns until April, with consumers only able to buy vehicles through click-and-collect.

Battery-electric vehicles (BEVs) continued their growth streak, however, with a 14.6 per cent rise in volume, as market share continued to grow, reaching 16.1 per cent – up from 10.7 per cent a year before.

However, plug-in hybrid vehicle (PHEV) uptake fell by 4,425 units to take a 5.5 per cent market share.

In total, plug-in vehicles comprised more than a fifth (21.6 per cent) of new cars joining the road in June.

The pace of this growth, however, is decelerating, with registrations up by 26 per cent in the first half of 2022, versus growth of 161.3 per cent during the first half of 2021.

The SMMT said that while growth rates were expected to moderate as the market begins to establish, the slowdown was more than had been anticipated.

Part of the fall was attributed to the continuing supply chain shortages, but the scrapping of the plug-in car grant means the UK was now the only major European market without purchase incentives for private EV buyers, said the SMMT.

All other powertrains saw declines in registration volumes and market share apart from hybrid electric vehicles (HEVs), which, despite a 1,172-unit fall, increased their market share to 10.6 per cent.

Mike Hawes, SMMT chief executive, said: ‘The semiconductor shortage is stifling the new car market even more than last year’s lockdown.

‘Electric vehicle demand continues to be the one bright spot, as more electric cars than ever take to the road.

‘But while this growth is welcome it is not yet enough to offset weak overall volumes, which has huge implications for fleet renewal and our ability to meet overall carbon reduction targets.‘With motorists facing rising fuel costs, however, the switch to an electric car makes ever more sense, and the industry is working hard to improve supply and prioritise deliveries of these new technologies given the savings they can afford drivers.’

Article courtesy of: published 5th July 2022