Falling demand for diesels sees November new car market down 11 per cent

The UK new car market declined for an eighth consecutive month in November, according to figures from the Society of Motor Manufacturers and Traders (SMMT). 163,541 vehicles were registered, down -11.2 per cent year-on-year, driven by a significant fall in diesel demand.

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

The Alternatively Fuelled Vehicles (AFV) sector, however, continued to make significant gains, growing 33.1 per cent. Petrol cars also saw a gain, though of a more modest 5.0 per cent. These increases could not, however, offset the heavy -30.6 per cent drop in diesel registrations. The decline follows months of confusion and speculation about the government’s air quality plans and its policies towards diesel cars.

Overall, registrations have declined -5.0 per cent in the eleven months in 2017, with 2,388,144 cars hitting British roads so far this year.

Mike Hawes, SMMT chief executive, said: “An eighth month of decline in the new car market is a major concern, with falling business and consumer confidence exacerbated by ongoing anti-diesel messages from government. Diesel remains the right choice for many drivers, not least because of its fuel economy and lower CO2 emissions. The decision to tax the latest low emission diesels is a step backwards and will only discourage drivers from trading in their older, more polluting cars. Given fleet renewal is the fastest way to improve air quality, penalising the latest, cleanest diesels is counterproductive and will have detrimental environmental and economic consequences.”

NFDA comments

Commenting on the figures, Sue Robinson, Director of the National Franchised Dealers Association (NFDA) which represents franchised car and commercial vehicle retailers in the UK, said: “While alternative fuel vehicles continued to grow significantly, registrations of new diesel cars showed a consistent decline as a consequence of recent media coverage and government’s announcements”.

Robinson continued, “The recently announced increase in tax on first registration of all new diesel cars affects the cleanest Euro 6, which in many cases still represent the most efficient and affordable vehicle. By failing to increase VED on older diesel cars, government is sending a confusing message to consumers that they should not buy a new diesel, but rather stay in their old cars or buy a second hand, dirtier diesel car.

“Positively, the resilience shown by the used car market continues to partially offset the decrease in new car registrations with many consumers considering second-hand cars as the most viable option for them.”

“We expect the new car market to continue to perform in line with these results in the last month of the year.”