Overall registrations remain under great pressure, but the latest new car sales figures point to another bumper month for electric vehicles. Meanwhile, diesel-fuelled internal combustion engine vehicles have taken the biggest hit. There are also signs that vehicle ownership preferences are changing. But what does this mean for the shape of the car market that feeds aftermarket tyre sales?
Andrew Rowson, co-founder and Head of Services at ecommotors is joining the panel at the next the Automotive Aftermarket Webinar Series, ‘Digitalisation; Accelerating the recovery of the aftermarket,’ which will take place on 29 September.
We are continually being told that electric vehicles are the future – indeed, petrol and diesel-engined vehicles are scheduled to be phased out in the UK market; the original deadline was 2040, but this was brought forward to 2035, and there is talk of possibly introducing the ban in 2030. This last date is regarded by many as unachievable – when the deadline was brought forward to 2035, Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders, described the situation as “extremely concerning” and accused the Government of “moving the goalposts.”
According to figures released today by the Society of Motor Manufacturers and Traders (SMMT), UK car manufacturing output fell 20.8 per cent in July, with just 85,696 units rolling off production lines during the month. Despite the continued ramp-up of production and reopening of almost all factories following the easing of lockdown measures, social distancing measures and ongoing economic uncertainty still stifled output. Today’s figures follow news that BMW intends to lay off 400 of the 950 agency personnel working at its Mini factory in Oxford.
The UK is taking steps forward in automated technology in vehicles with the launch of a call for evidence on 18 August 2020 to help shape how innovative new systems could be used in future on GB roads. The call for evidence will look at the Automated Lane Keeping System (ALKS) – an automated system that can take over control of the vehicle at low speeds, keeping it in lane on motorways.
The UK’s new heavy goods vehicle (HGV) market declined by 73.4 per cent year-on-year in the second quarter of 2020. The Society of Motor Manufacturers and Traders (SMMT) reports that 4,151 units were registered between 1 March and 30 June 2020. Just 328 buses and coaches joined UK roads during the quarter.
Figures released by the SMMT reveal that used car sales in Q2 2020 were 1,039,303 units; -48.9 per cent down on the same period last year (2,034,236). Year to date, the figures are slightly less depressing, with YtD clocking up 2,891.222 sales, as opposed to 4,054,380 for the first six months of 2019 – a -28.7 per cent fall.
For the first time in many months, there was an increase in registrations of light commercial vehicles, up to 3.5 tonnes, says the National Franchised Dealers Association. Sales of light commercials rose by 7.1 per cent in July with 27,701 units, according to the latest SMMT figures. Much of this is considered to be pent up demand for vehicles that would have been acquired earlier this year. Year to date, the market is down by -39.0 per cent.
The Society of Motor Manufacturers and Traders has announced the first growth month for the UK’s light commercial vehicle (LCV) market since January. There was a 7.1 per cent increase in registrations in July, with 27,701 new LCVs joined Britain’s roads.
UK motorists are some of the fastest adopters of online car buying, something that is rapidly becoming the new normal in Britain, Germany and Spain, according to research conducted by online car retailer carwow. A survey of over 1000 consumers who bought a car through carwow since dealerships were allowed to reopen found 54 per cent of recent the company’s customers in the UK said they would continue to do the bulk of their car buying online from now on. In Spain it was 45 per cent and it was 38 per cent in Germany.
Following the news that UK new car registrations were up 11.3 per cent year-on-year in July, Michael Woodward, UK automotive lead, Deloitte, cautiously suggested the figures point towards a speedy recovery:
Commenting on SMMT’s new car registration figures for the month of July, Andrew Burn, UK head of automotive at KPMG, said: “With social distancing measures easing and dealerships finally in a position to reopen, it’s great to see pent-up demand released and car registrations picking-up again. However, as the year-to-date figures make painfully clear, total lost sales in 2020 are expected to be £20bn, so in many ways it’s a case of damage limitation. We’re still a long way off pre-Covid-19 levels of sales.
New car registrations rose for the first time this year in July. The figure rose 11.3 per cent in the month, year-on-year, according to the latest Society of Motor Manufacturers and Traders (SMMT) figures. 174,887 cars were registered in July 2020, supported by the first full month of trading for dealerships since February. July 2019 registrations were affected by declining business and consumer confidence undermined the market. Pent-up demand and special offers led to a reprieve for the sector, but overall registrations are still down by -41.9 per cent or 598,054 units year-to-date. Despite the increase in July, SMMT’s full year outlook is for a -30 per cent decline in registrations, representing more than £20 billion of lost sales.
UK commercial vehicle production increased 23.9 per cent in June year-on-year, but this was not enough to mitigate first-half contraction in 2020. Figures released today by the Society of Motor Manufacturers and Traders (SMMT) show that 4,144 vans, trucks and buses left production lines last month. The increase appears particularly strong because it follows a particularly weak June 2019, when output fell by more than half due to key model changeovers. Despite this production ramp-up, the first six months of 2020 saw total output decline by -24.8 per cent, on the same period in 2019, due to the pandemic lockdown of global markets.
Car industry analysts have outlined the compound challenge facing the UK’s car sector following the publication of the Society of Motor Manufacturers and Traders’ half-year figures. The stats show that the first half of 2020 yielded the lowest level of UK car manufacturing since the 1950s. Edwin Kemp, head of automotive strategy at KPMG, commented that the SMMT’s June 2020 new car manufacturing analysis is a harbinger for businesses’ likely descent into insolvency throughout the automotive supply chain. Peter Barnes, head of automotive at global legal business, DWF, added that the challenges facing the UK automotive industry add up to a perfect storm for the sector.
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