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Stable UK New Car Market With Rising EV Demand In August 2024
The UK new car market saw a slight decline in August, with registrations dropping by 1.3% to 84,575 units, according to the Society of Motor Manufacturers and Traders (SMMT). This month is typically quiet as buyers often wait for September's new number plate. Despite this, fleet purchases remained strong, making up 60% of the market.
Battery electric vehicle (BEV) registrations increased by 10.8%, driven by significant summer discounts and new model launches. BEVs reached a market share of 22.6% in August, the highest since December 2022. Year-to-date, BEV market share has risen to 17.2%, with expectations to hit 18.5% by year-end.
Petrol and diesel car registrations fell by 10.1% and 7.3%, respectively, yet they still accounted for over half of all new car sales in August. Plug-in hybrid (PHEV) registrations also declined by 12.3%, capturing a 6.8% market share, while hybrid electric vehicles (HEVs) saw a significant rise of 36.1%, taking up 13.8% of the market.
The automotive sector is urging the government to introduce measures that will encourage more buyers to switch to electric vehicles (EVs). These include binding targets for public chargepoint installations and reintroducing incentives for private buyers. The industry also seeks the removal of disincentives like the Vehicle Excise Duty expensive car supplement set for 2025.
Mike Hawes, SMMT Chief Executive, stated, "August’s EV growth is welcome, but it’s always a very low volume month and so subject to distortions ahead of September’s number plate change." He added that compelling offers from manufacturers and an increasing variety of models would help gauge true market demand.
Economic Contributions
The UK automotive industry is crucial to the economy, contributing £93 billion in turnover and £22 billion in value added annually. It invests around £4 billion each year in research and development (R&D). The sector employs nearly one million people across various roles, with many jobs located outside London and the South-East.
The industry also plays a significant role in exports, accounting for 12% of total UK goods exports. Vehicles produced in the UK are traded globally, generating £115 billion in automotive trade annually. The sector includes over 2,500 component providers and some of the world's most skilled engineers.
Future Outlook
The SMMT forecasts around 364,000 BEV registrations for the year but notes this will fall short of the 22% target required by the Zero Emission Vehicle Mandate. Ahead of the Autumn Budget on October 30th, there are calls for urgent action to support EV adoption further.
The UK manufactures a wide range of vehicles including cars, vans, taxis, trucks, buses, coaches, and specialist vehicles. The sector is supported by vibrant aftermarket and remanufacturing industries and also supports jobs in advertising, chemicals, finance, logistics, and steel sectors.
The SMMT continues to advocate for policies that will bolster EV uptake and ensure that infrastructure keeps pace with growing demand. This includes pushing for more public chargepoints to match industry targets.
The automotive industry's contributions extend beyond manufacturing; it supports other key sectors such as advertising and logistics while providing higher-than-average wages compared to other industries.
For more detailed information on UK Automotive statistics and reports from SMMT can be found at their official website: www.smmt.co.uk/reports/smmt-motor-industry-facts/
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