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UK new car market recovers fuelled by ‘green’ car demand

Cherry Reynard
Written By:
Cherry Reynard
Posted:
Updated:
05/03/2019

The UK’s new car market was stable in February, with 81,969 new cars registered on UK roads.

This was up 1.4% on January, when sales were weak, according to the latest figures released today by the Society of Motor Manufacturers and Traders (SMMT). February is usually a quiet month, as number plates update to the new year in March.

The strongest growth was seen among ‘alternatively fuelled (AF) cars’, where sales rose 34%, the 22nd month of consecutive growth. Diesel continued to drop, with sales falling 14.3% over the same period in 2018. The overall market share of diesel cars has dropped from 35% to 29.6%. Most of this has gone towards petrol cars, which increased their share of the market from 60.8% to 64.9%. However, AF cars are now 5.5% of the market.

Registrations of zero-emission electric cars enjoyed particular growth, more than doubling to 731 units, although they still accounted for less than 1% of the market (0.9%). In the four months since the October 2018 reform to the Plug-in Car Grant, the market for plug-in hybrid electric vehicles (PHEVs) has only grown by 1.7%, compared with 29.5% over the first 10 months of 2018. This suggests that removing the incentive for PHEVs is having an adverse effect.

There are 14 new launches planned of electric and plug-in models at the Geneva Motor Show today. There are around 40 existing plug-in models on the market in the UK, with more than 20 more expected to arrive in showrooms in 2019.

Mike Hawes, SMMT chief executive, said: “ It’s encouraging to see market growth in February, albeit marginal, especially for electrified models. Car makers have made huge commitments to bring to market an ever-increasing range of exciting zero and ultra low emission vehicles and give buyers greater choice. These cars still only account for a fraction of the overall market, however, so if the UK is to achieve its electrification ambitions, a world-class package of incentives and infrastructure is needed. The recent removal of the plug-in car grant from plug-in hybrids was a backward step and sends entirely the wrong message. Supportive, not punitive measures are needed, else ambitions will never be realised.

James Fairclough, CEO of AA Cars, said the new car market had bucked its five month downhill streak, with the ‘freefall’ in diesel sales slowing: “While the withdrawal of government grants for plug-in hybrid vehicles and a winding down of incentives for electrics is doing little to impact demand for these cars at this stage, it’s important that the momentum in this area isn’t stifled by cost-cutting exercises.

“Undoubtedly the year ahead will provide a challenging sales environment for big ticket item retailers. Having said that, the most versatile dealers are already providing adapted buying solutions online – ready to weather any storms that come their way. It will also be interesting to see if yesterday’s call from the FCA for greater transparency from the car finance market helps to maintain this upward swing in new registrations and, in turn, stimulate additional sales.”

The best seller for the year to date remains the Ford Fiesta. The VW Golf, Mercedes Benz A Class and ever-popular Nissan Qashqai also make the top 10.