- Levelling off after record 2015 and strong early 2016 growth
- UK new car registrations rose 0.1%
- Demand for AFVs up 24.7% but still small market share
UK new car registrations experienced a moderate increase in July, up 0.1% for the month, with the fleet share growing to 55.5% against a continued matching dip in private purchases, according to figures released by SMMT.
So far this year 1,599,159 new cars have been registered, putting demand in the year-to-date 2.8% higher than for the same period in 2015 following a strong first quarter.
Fiesta continued to top the charts but Vauxhall had three in the top ten, with Corsa second, Astra in third ahead of Ford’s Focus, Nissan Qashqai and VW Golf, with Mokka eighth. See chart below.
July followed the trend seen throughout this year whereby lower private registrations down 6.1% were offset by fleet purchases, increased by 5.0% this month, with business picking up to be up 1.9%.
Diesel dipped 1.1% but demand for alternatively fuelled vehicles remained remarkably strong with 24.7% more registrations compared with the same month in 2015.
SMMT chief executive Mike Hawes said: “After a healthy start to 2016 and record registrations in 2015 the market is showing signs of cooling. The automotive market is a vital part of the British economy and it’s important government delivers the economic conditions which instil business and consumer confidence.
“With low interest rates, attractive finance options and exciting new models coming to the showrooms, the market still has lots to offer customers.”
The registration figures were followed by the Bank of England’s cut in interest rates – a move, following the Brexit referendum, monitored with interest by Glass’s.
Rupert Pontin, Glass’s director of valuations, said: “Yesterday’s release of the new car registration figures for July from the SMMT is broadly in line with Glass’s expectations and it is good to see that the market appears to be holding its own for the moment in a general climate of consumer concern.
“However, it is important to note that private vehicle registrations have dropped noticeably this month and this is becoming a bit of a trend and something that reflects anecdotal market commentary gathered by our editorial team.
“Consideration must also be given to the fact that many cars are on 6 to 10-week lead times at the moment and the market may be seeing the tail end of vehicle orders placed in the run up to the referendum and therefore prior to the Brexit announcement.
“As such the market may well be weaker than the figures suggest, a point that has not been lost by the Bank of England who are concerned enough to have dropped the bank base rate and indicated a further reduction may be needed before Christmas.
“The stability of the new cabinet under a new Prime Minister and the drop in interest rates may well be good enough to keep the market level but the coming weeks will be most interesting.”