28 Feb 2024

New car sales up 21% for September, but private buyers in minority in electric market

New car sales were up 21% for September’s number plate change with 272,610 sold through the month, according to the latest figures from the SMMT. While this was the 14th consecutive month of growth sales were still 20.6% below pre-pandemic levels.

52.5% of sales were made to large fleets, although private consumer demand did increase, by 5.8% s remain -20.6% below pre-pandemic levels.

Plug-in hybrid vehicles (PHEVs) sales were up 50.9% making up 6.8% of the total, while hybrid electric vehicles (HEVs) were up 30.7%, representing 13.9% of all sales. Battery electric vehicle (BEV), sales were up 18.9%, although in terms of market share BEVs have fallen to 16.6% of the total, down 0.3% on this time last year. The increase in BEV sales is the result of fleet purchases, which were up by 50.6%. Meanwhile, private BEV registrations fell by 14.3%. Less than one in ten private buyers bought a BEV.

Mike Hawes, SMMT Chief Executive, said, “A bumper September means the new car market remains strong despite economic challenges. However, with tougher EV targets for manufacturers coming into force next year, we need to accelerate the transition, encouraging all motorists to make the switch. This means adding carrots to the stick – creating private purchase incentives aligned with business benefits, equalising on-street charging VAT with off-street domestic rates and mandating chargepoint rollout in line with how electric vehicle sales are now to be dictated. The forthcoming Autumn Statement is the perfect opportunity to create the conditions that will deliver the zero emission mobility essential to our shared net zero ambition.”

NFDA Chief Executive Sue Robinson said: “Vehicle sales have continued to rise despite the uncertainty created by the UK Government change of policy on EV.”

She continued: “Recent policy changes in relation to ULEZ and the sale of new petrol and diesel vehicles has created uncertainty in the industry. In a recent poll, NFDA found that 62% of surveyed dealers are expecting demand for EVs to decrease and 80% feel that the UK Government needs to introduce more price incentives for consumers.”

On the preponderance of fleets in the EV side of the market, John Wilmot, CEO, car leasing comparison website LeaseLoco, noted: “There is an urgent need for financial incentives designed to make electric cars more accessible to those who cannot take advantage of salary sacrifice schemes and corporate discounts. Currently, only company directors and employees with access to salary sacrifice can benefit from the 2% benefit-in-kind taxation rate.

“We need a more level paying field. Financial fairness should be extended to all, not just a select few, and if the government is committed to achieving net-zero emissions, addressing this issue is crucial.”

Mark Oakley, Director of AA Cars, added: “September’s arrival of the new ‘73 registration plates helped the new car market extend its unbroken run of increasing sales to an impressive 14 straight months. Demand is holding up well despite the financial challenges households are facing, with many drivers who’d been waiting to upgrade or replace their old car choosing to do so as the new plates came in. The supply problems of last year are thankfully in the rear view mirror now.

“For now it’s too early to gauge what impact, if any, the Government’s decision to push back the upcoming ban on the sale of new petrol and diesel cars will have on demand. Either way, greater choice and increasing competition between EV manufacturers continue to drive up sales of new electric models – which were up 18.9% year on year in September. This in turn is boosting supply in the used car market, as more second-hand and nearly-new EVs appear on dealers’ forecourts and provide a more affordable option for drivers who are looking to go green.”