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New car sales on the up as dealers prepare to reopen

Emma Lunn
Written By:
Emma Lunn

Demand for new 21 number plates and electric vehicles is driving the recovery in new car sales.

UK new car registrations grew for first time since August – up 11.5% – in March, according to the Society of Motor Manufacturers and Traders (SMMT).

Compared with the 2010 to 2019 March average of 450,189, registrations were down 36.9%, with 283,964 units registered. So far, 2021 has seen 58,032 fewer cars registered compared to January to March last year, equivalent to a loss of £1.8bn in turnover during the first quarter.

The news comes as car showrooms prepare to open on 12 April as lockdown restrictions are eased. About 8,300 registrations a day are needed for a return to average pre-pandemic levels by the end of the year.

In comparison, the industry has averaged around 7,400 a day during the past decade and current levels are closer to 5,600 a day.

‘Click and collect’ has provided a lifeline for the car sector. However, SMMT pointed out that this method of buying doesn’t offer drivers the same experience and excitement as a showroom environment.

The shift to new technologies is continuing, with plug-in vehicle demand reaching its highest ever volume.

Registrations of battery electric vehicles increased by 88.2% to 22,003 units in March, while plug-in hybrid rose by 152.2% to 17,330. Hybrid electric vehicles also rose 42% to reach 21,599 registrations.

Mike Hawes, SMMT chief executive, said: “The past year has been the toughest in modern history and the automotive sector has, like many others, been hit hard. However, with showrooms opening in less than a week, there is optimism that consumer confidence – and hence the market – will return. We know we will see record breaking growth next month given April 2020 was a washout, but a strong, sustainable market is possible if customers respond to the choice and competitive offers the industry provides within the safest of showroom environments.

“New plug-in models are already helping drive a recovery but to convince more retail consumers to make the switch, they must be assured these new technologies will be convenient for their driving needs and that means, above all, that the charging infrastructure is there where they need it, and when they need it.”

John Wilmot, CEO of car leasing comparison website LeaseLoco, said: “Once again, the monthly growth in electric vehicle sales stands out, showing that the public does have the appetite to buy EVs.

“And it makes the government’s decision to cut EV grants recently even more short-sighted considering it’s the continued growth in electric car sales that is going to help drag the car industry out of the deep hole it finds itself in.

“Car manufacturers are showing their commitment to EVs by ramping up the number of new models being launched this year. But the government should be doing more to match the ambitions of carmakers, promoting electric vehicles to the public and encouraging drivers to switch to electric now.”