The UK’s automotive industry is a significant part of the economy, generating billions in revenue and employing thousands of people.
In the UK vehicle market, there are always new trends and technologies shaping the market, with the latest data showing continued growth in new car registrations.
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Growth Driven by Fleet Sales
The Car Expert reports that while private new car sales have only increased by 6%, fleets have recorded a near 50% rise, driving the growth.
Although overall sales have risen for seven consecutive months, the majority of this growth has been for petrol-powered new cars, with electric and plug-in hybrids losing market share.
Prioritising Lower Purchase Price Over Environmental Benefits
This trend is a cause for concern since it suggests that the lower purchase price of petrol cars is prioritised over the lower running costs and environmental benefits of electric vehicles.
Sales of petrol-powered vehicles have risen by a third compared to February last year, with a market share for the year-to-date over 43%, nearly 3% higher than in 2022. While plug-in hybrid cars’ market share has declined from nearly 8% to just above 6%, electric vehicle sales remain at par with last year, recording the same market share of 14% in 2023 so far.
These trends raise questions about the UK’s ability to achieve its goal of phasing out petrol and diesel vehicles by 2030.
Improvements in New Car Prices and Finance Deals
The UK’s most comprehensive automotive consumer advice site reports that the picture could improve for new car prices and finance deals.
In February, Vauxhall Corsa and Mokka became the two best-selling cars after the brand reintroduced 0% finance offers across its range. It is expected that other manufacturers may follow suit with cheap finance offers.
Moreover, sustained growth in the new car market over the last half-year should ease used car prices as supply improves and more vehicles hit the second-hand market.
Discouraging Trends for Electric Car Adoption
However, the trends in the vehicle market are not encouraging for electric car adoption.
The Car Expert reports that although overall new registrations were up by 15,000 units in February, 11,000 of these increased sales were petrol-powered cars.
The growth of electric vehicles was less than 2,000 sales, with petrol cars increasing their market share, while electric and plug-in hybrid vehicles lost market share.
The industry expects Tesla to shift a lot of electric vehicles in March, but other brands will need to increase their electric vehicle sales to make the necessary inroads on fossil-fuelled vehicles.
In conclusion, the UK vehicle market is currently dominated by petrol-powered cars, with electric and plug-in hybrids losing market share. This trend is worrying given the government’s plan to phase out petrol and diesel vehicles by 2030.
While there is hope for the market with sustained growth, improved finance deals, and expected increases in electric vehicle sales, the industry must continue to adapt to meet the changing demands of consumers and the government’s goals.