Sales in the UK new car market recorded 27.5% year-on-year growth in January, according to the latest figures from the Society of Motor Manufacturers and Traders (SMMT).
Despite the growth, the market remains well below pre-pandemic levels, down 22.9% on January 2020 levels, as chip shortages continue to impact supply.
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Electrified vehicles continue to bolster the growth, with battery electric (BEV), plug-in hybrid (PHEV) and hybrid (HEV) cars accounting for 71.5% of the uplift in registrations. Plug-in vehicles enjoyed another bumper month, with 14,433 BEVs and 9,047 PHEVs registered, equal to some 20.4% of the market. With 13,492 HEVs also registered, almost one in three new cars joining British roads in January was electrified.
The SMMT noted that there are now more than 140 plug-in car models available to UK buyers, with almost 50 more scheduled for release in 2022. Cutting CO2 even further, however, will require more drivers to switch to electric and other zero emission technologies. One of the obstacles remains perceptions of a lack of charging infrastructure, which must be built ahead of demand – and that demand is increasing exponentially.
Furthermore, as manufacturers strive to bring down the costs of these new technologies, government support through purchase incentives and reduced motoring taxes can help accelerate the take-up so that the road transport sector can meet society’s net zero timeline.
Registrations of BEVs and PHEVs are predicted to grow by 61% and 42% respectively this year, meaning that almost one in four new cars would come with a plug. Overall, total new car registrations are expected to rise 15.2% on 2021, to 1.897 million units. This is a downward revision from October’s outlook of 1.96 million, as the ongoing semiconductor shortage, increasing costs of living and rising interest rates are expected to dampen some demand in 2022.
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By GlobalDataA 2022 market of 1.897 million would still be down 17.9% on the pre-pandemic 2019, but the recovery is expected to continue into 2023, with the market projected to climb above two million units for the first time since 2019.
Mike Hawes, SMMT chief executive, said: “Given the lockdown-impacted January 2021, this month’s figures were always going to be an improvement but it is still reassuring to see a strengthening market. Once again it is electrified vehicles that are driving the growth, despite the ongoing headwinds of chip shortages, rising inflation and the cost-of-living squeeze. 2022 is off to a reasonable start, however, and with around 50 new electrified models due for release this year, customers will have an ever greater choice, which can only be good for our shared environmental ambitions.”
