New car registrations enter second year of post-Covid expansion
By Josh White
Date: Tuesday 05 Sep 2023
(Sharecast News) - The UK's new car market saw robust growth of 24.4% in August, as 85,657 new vehicles were registered, according to fresh data from the Society of Motor Manufacturers and Traders (SMMT).
That growth marked the sector's entry into its second year of expansion, although it remained 7.5% below pre-pandemic levels.
Despite the strong performance, SMMT warned that the delay in issuing details of the zero emission vehicle mandate could jeopardise the nation's decarbonization goals.
The latest figures revealed that much of the August growth was propelled by large fleet registrations, which soared by 58.4% to 51,951 units.
Business registrations also saw a substantial uptick, increasing by 39.4% to reach 1,635 units.
On the other hand, private demand appeared to be more tepid, falling by 8.1% in comparison to last year's supply-constrained market.
August also set new records for electrified vehicles, capturing almost four in 10, or 37.8%, of new car registrations.
Battery electric vehicles (BEVs) saw an exceptional rise of 72.3%, making up 20.1% of the market - the highest share recorded since last December.
Plug-in hybrids also performed strongly, showing a 70% increase and accounting for 7.7% of new registrations, while hybrid vehicles experienced a moderate 6.8% growth, forming 10% of the new car market.
However, the sector was expressing concerns over the delay in revealing specifics for the anticipated zero emission vehicle mandate, which was expected to be introduced in less than four months.
Although committed to net zero objectives, the SMMT said the industry feared that the lack of clarity could hinder market adaptation and could risk failing to meet decarbonisation goals.
It stressed that a comprehensive incentive package was crucial to boost demand from private consumers, akin to the fiscal incentives currently benefiting businesses.
"With the automotive industry beginning a second year of growth, recovery is underway with EVs energising the market," said SMMT chief executive Mike Hawes.
"But with a new zero emission vehicle mandate due to come into force in less than 120 days, manufacturers still await the details."
Hawes said businesses could not plan on the basis of consultations, adding they needed certainty.
"And now, more than ever, the government must match action to ambition, ensuring there are the incentives and infrastructure in place to convince drivers to make the switch."
Reporting by Josh White for Sharecast.com.
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