March New Automotive Market Sustains Development As Producers Shore Up Electrified Demand

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• New automotive registrations rise 10.4% in greatest March since 2019 and twentieth consecutive month of progress.
• General enhance pushed by fleet funding with weak confidence constraining non-public retail demand.
• Business requires EV incentives with battery electrical automotive market off the tempo.

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The UK new automotive market clocked up its twentieth consecutive month of progress in March, with a ten.4% rise in registrations. In what is usually the busiest month of the yr because of the new numberplate, 317,786 new vehicles reached the highway with a 24 plate – one of the best March efficiency since 2019, though nonetheless -30.6% under pre-pandemic ranges.¹

Development was once more pushed by fleet funding, up 29.6% because the sector continues to recuperate following the constrained provide of earlier years. Registrations by non-public patrons fell by -7.7%, with a difficult financial backdrop of low progress, weak shopper confidence and excessive rates of interest. The small enterprise registration section, in the meantime, declined -8.0%.

Petrol vehicles retained the lion’s share of the market, at 55.7%, with registrations up 9.2% yr on yr, as diesel volumes fell -2.7% to account for simply 7.3% of demand. Uptake of hybrid electrical automobiles (HEVs) reached file ranges, rising by 19.6% to 44,550 items and 14.0% of the market, whereas the largest proportion progress was recorded by plug-in hybrids, up by greater than a 3rd to 24,517 items, or 7.7% of all new registrations. Conversely, whereas battery electrical car (BEV) registration volumes had been at their highest ever recorded ranges, market share fell by one proportion level from the identical month final yr, down to fifteen.2%. Registrations rose 3.8%, with solely fleets displaying any quantity progress.

The autumn in BEV market share inside a rising market underscores the necessity for presidency to help customers to hurry up fleet renewal. Massive fleets proceed to drive BEV uptake, thanks to forcing tax incentives however whereas registration volumes elevated in March, market share declined. A troublesome financial backdrop makes it ever more difficult for customers to put money into these new applied sciences.

Producers themselves are providing beneficiant incentives, serving to extra drivers swap to zero emission automobiles and ship authorities and trade carbon targets, however this can’t be sustained indefinitely.² A full market transition wants incentives not only for fleet and enterprise patrons however non-public retail patrons as properly, one thing that will deliver the UK into line with different main markets. Briefly halving VAT on BEVs, revising the edge for the costly automotive complement on Automobile Excise Obligation subsequent April, and abolishing the ‘pavement penalty’ on public EV charging by equalising VAT charges to five% consistent with residence charging, would make a major distinction to customers, serving to extra of them transfer to zero emission automobiles sooner.

Mike Hawes, SMMT Chief Govt, mentioned:

Market progress continues, fuelled by fleets investing after two robust years of constrained provide. A sluggish non-public market and shrinking EV market share, nonetheless, present the problem forward. Producers are offering compelling provides, however they will’t single-handedly fund the transition indefinitely. Authorities help for personal customers – not simply enterprise and fleets – would ship a optimistic message and ship a sooner, fairer transition on time and heading in the right direction.

Notes to editors

1 March 2019: 458,054 registrations
2 What Automotive analysis exhibits EV reductions have elevated by 204% since January 2023

Press Launch from SMMT