Eighth month of decline for new cars sales in UK as diesel pulls market down

(REPOST: Autovista Group)

For the eighth consecutive month, figures released by the Society of Motor Manufacturers and Traders (SMMT) showed a market falling rapidly, with an 11.2% drop in sales compared to the same month in 2016. In total, 163,541 vehicles were registered, a large majority of these being either petrol or alternatively fuelled vehicles (AFVs).

The country’s new car market has been in decline since April when new vehicle excise duty (VED) rates were put in place by the UK Government. While the SMMT expected demand for vehicles to drop compared to record figures in 2016, it was forced to amend down its forecast in November, with expectations of a 4.7% overall fall in sales for the whole year.

However, while the double-digit fall is comparable to October’s 12.2% drop, the difference in the number of cars sold in November compared to October increased in 2017. During 2016, the difference between the two months was 3,933 vehicles, while this year saw 5,349 more vehicles sold, an increase of 1,416. This could partially be down to various ‘scrappage’ schemes introduced by manufacturers to take more polluting vehicles off the country’s roads and incentivise drivers into less polluting alternatives.

The figures are being dragged down by a decline in diesel demand, perhaps partially driven by the increase in VED which wiped out what was once an incentive to purchase vehicles powered by the technology due to their lower CO2 output. In November, the market for diesel declined by 30.6% compared to the same period last year, while petrol sales rose by 5% and AFVs by 33.1%, albeit on modest sales totals from 2016.

Business, fleet and private registrations all fell in the month, down 33.6%, 14.4% and 5.1% respectively. Registrations fell across all body types except specialist sports, which grew 6.7%. The biggest declines were seen in the executive and mini segments, which decreased 22.2% and 19.8% respectively, while demand in the supermini segment contracted by 15.4%.

Year-to-date figures reveal a total decline so far of 5%, with 2,388,144 vehicles hitting UK roads this year. Of these, diesel has seen an overall drop in its market share of 16.1%, while petrol has grown its share by 3.1% and AFVs by 34.6%. There are drops in the first 11 months across private, fleet and business sales, by 6.3%, 3.9% and 5.4% respectively.

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