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Diesel Myth Buster (October 18, 2019 9:17 am)

Comments on SMMT new car sales report

Michael Woodward, UK automotive partner at Deloitte

Michael Woodward, UK automotive lead, Deloitte, said: “Car sales declined by 4.1% this month compared to the same time last year, making it the lowest July sales since 2012.

“Whilst there are a number of factors impacting the latest sales figures, uncertainty surrounding Brexit is impacting both fleet and business sales, down -4.7% and -22.5% respectively. Deloitte’s latest CFO survey revealed businesses are pausing investment, and the decline in business sales is part of this wider trend.

“For consumers, however, the growth of battery electric vehicles continues. Sales were up 158% month-on-month, with the sector expected to increase its market share significantly over the next few years. Recent announcements on company car tax included a clear incentive to support the adoption of zero emission cars from 2020.

“Car manufacturers are investing significantly in electric vehicle development and the new focus on introducing them to fleet and business sales will be welcomed.

“Alongside government incentives, the total cost of owning and running an electric vehicle continues to fall. Deloitte analysis predicts a tipping point will be achieved in the UK by 2021, when electric vehicles are expected to become cheaper than their diesel and petrol counterparts.

“For those consumers and businesses either unable or unwilling to make the leap to electric, we are seeing hybrid electric vehicles as a stepping stone, as sales jumped 34% compared to June.”

Jon Lawes, MD Hitachi Capital Vehicle Solutions

Jon Lawes, Managing Director, Hitachi Capital Vehicle Solutions comments: “Despite another challenging month for the UK car industry, a 70.6% year-to-date increase in battery electric registrations and its highest market share to date is encouraging for the future state of the market.

“Significant obstacles remain however. A 49.6% decline in plug-in hybrid models shows that the decision to exclude many of these vehicles from qualifying for subsidies is continuing to take its toll, and the lack of electric plug-in infrastructure is still hindering the transition to AFVs more widely.

“With a 62% majority in our recent research supporting the move to electric models, the appetite is there but the Government must work harder to incentivise greener vehicle purchases.”

Jonathan Moss, head of the Transport sector at global legal business DWF

Jonathan Moss, head of the Transport sector at global legal business DWF comments: “Today’s latest release from the Society of Motor Manufacturers and Traders (SMMT) shows once again a market in turmoil with the new car market declining by -4.1% to 157,198 registrations.

“However the figures also demonstrate that while diesel cars have continued to depreciate in popularity, low emission hybrid electric cars increased by 34.2%, with 7,758 new car registrations and battery electric vehicles rose by 158.1%, offering a glimmer of positivity to the car industry.

“Despite their relatively small market share, the uptick in sales of AFVs is a welcome development, particularly following the dip reported in last month’s figures for AFVs. To ensure continued growth, long term investment incentives for car manufacturers are needed as well as innovative plans focusing on more R&D for alternative fuel transportation.”

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