The number of new cars sold in the UK fell almost 20% year-on-year in April, as a combination of fewer selling days and the pre-VED rush in March slowed the market dramatically.
Just 152,076 cars were sold in April 2017, down 19.8% from the 189,505 sold in in April 2016.
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Sales of all engine types declined, including alternative fuelled vehicles (AFVs), which have usually performed strongly in recent years. In April, however, sales fell 1.3% year-on-year to 6,273. As this was a much smaller fall than the overall market, market share still increased from 3.4% to 4.1% over the period.
The bulk of the fall came from diesel cars, with sales falling from 93,940 to 68,306 over the period (down 27.3%), though petrol cars sales also experienced a double digit fall (down 13.1% to 77,497).
By market segment, private car sales witnessed the most rapid decline, falling 28.4% to 59,912. This gave the segment a market share of under 40%.
Fleet sales fell by a smaller amount, 12.3%, to 86,678 cars, or 57.0% of all sales in the month, with business cars making up the remainder.
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All three of the traditional ‘big three’ (Ford, Vauxhall and Volkswagen) saw large year-on-year declines in the month.
Ford sales fell 30.6% to 16,183, Vauxhall sold 10,732 cars (down 33.1%) and Volkswagen sold 9,954 cars (down 41%).
This drop allowed Mercedes, Audi and BMW to all overtake Vauxhall and Volkswagen in sales this month, with double digit growth from Mercedes (10.5% to 13,345 sales) pushing it to second.
Numerous other brands saw sales decline by over 20%, including Peugeot, Toyota, Land Rover, Renault and Citroen. Fiat sales almost halved year-on-year, from 3,890 to 1,981.
Comments
Despite the somewhat precipitous drop, some industry commentators remained relatively calm about the falling sales.
Mike Hawes, SMMT chief executive, said, “With the rush to register new cars and avoid VED tax rises before the end of March, as well as fewer selling days due to the later Easter, April was always going to be much slower. It’s important to note that the market remains at record levels as customers still see many benefits in purchasing a new car. We therefore expect demand to stabilise over the year as the turbulence created by these tax changes decreases.”
Sue Robinson, director of the National Franchised Dealers Association: “As expected April has seen a 19.8% decline in new vehicle registrations as a result of a number of factors: increase in VED on the 1 April 2017; Easter falling in April and following a record month in the history of new vehicle volumes. April is always one of the weakest months for new retail but with record low interest rates and record high employment levels consumer demand remains high.”
For Richard Jones, managing director of Black Horse, April’s figures indicated the beginning of a period of more uncertainty: “As expected, we are starting to see a cooling of the market following the highs of recent months, not least after the record figures in March which were artificially inflated due to the changes in vehicle excise duty that followed. Demand for new cars was clearly pulled forward to new plate month in anticipation of these tax changes.
“The rest of the year is more uncertain – we still expect a small reduction in market size overall in 2017 with significant differences at manufacturer brand level. We also expect to see the diesel / petrol sales mix to continue to change – customers may be confused by news stories related to diesel and so the government, media and trade bodies need to work together to put customers in a better informed position.”
Chris Bosworth, director of strategy at Close Brothers Motor Finance, suggested these figures could be a sign of more consumers looking at the nearly new sector: “The record-breaking golden period for new car registrations always had to come to an end at some point, and given the highly volatile economic climate, it’s not surprising today’s figures show a decrease in demand for new cars. We expect the turbulent political landscape, rising inflation and its’ impact on consumer spending will also hinder new car growth in the months ahead.
“Figures from our Britain under the Bonnet report highlights this, with 5.5 million British motorists saying Brexit has directly impacted their car purchasing plans and has made them more likely to purchase a used car or to hold off their purchase altogether – all of which can have a knock-on effect on the industry and the wider economy. As such, we expect that consumers will flock to the 1-3 year ‘nearly new stock’ market, given the quality and value of cars available in this market.”
