Michael Woodward, UK automotive lead at Deloitte, said: “At the end of a challenging year, it is unsurprising to see year-on-year new car sales fall by 11% in a month that is nearly always quiet for dealers; reflected in both private (-14%), and fleet (-8%) sales.
“2020 saw 29% fewer new cars on the road than in 2019, marking a fourth consecutive year of declining sales and suggesting the fallout may be felt for some time still.
“However, many manufacturers and dealers remain optimistic for the year ahead, in spite of the latest UK lockdown measures. Whilst showrooms will be closed as in previous lockdowns, manufacturing facilities are expected to remain open this time. For dealers, click and collect, MOT and repair services also remain permitted offering a valuable, and profitable, lifeline.
One in ten vehicles sold in the UK now electric
“Electric vehicles continued to outperform the market in December. Both battery electric (BEV) and plug in hybrid (PHEV) vehicles saw year-on-year growth this month, of 344% and 103% respectively. Combined, electric vehicles grew their market share to 23%, up from 6% this time last year. Overall, 2020 was a significant year for EVs with sales topping 175,000 and market share reaching 11%.
“The stage is set for further growth with the government and manufacturers showing significant commitment to EVs. For example, bringing forward the ban on new petrol and diesel sales to 2030 brings the UK in line with some European markets, such as Ireland and The Netherlands, and is more ambitious than many other major European markets; in some cases by a decade.
“This show of commitment, coupled with financial and tax incentives and a growing focus on the green agenda, will make EVs more desirable than ever in 2021 and the sector will have diesel’s 16% share of the market firmly within reach.
“Speed of growth over the next year will depend on consumer confidence in the UK’s’ charging infrastructure. However, we need only look at Norway, which recently reached a landmark EV market share of 54%, to see what is possible with all pieces of the jigsaw in place.”
Jon Lawes, Managing Director of Hitachi Capital Vehicle Solutions, said: “2020 was a particularly challenging year, resulting in a near 30 year low for car registrations, and we can expect economic uncertainties to continue into the first quarter of 2021 while the pandemic dampens consumer confidence.
“However the UK’s long negotiated tariff-free trade agreement with the EU should provide a welcome boost for the motor industry to lay the foundations to support a recovery in the sector.
“Similarly, the positive trend in EV uptake demonstrates that the transition to electric will gather momentum in the months ahead heightened by the wide range of new EV models coming to market in 2021 and growing consumer demand.”
BVRLA Chief Executive Gerry Keaney has issued the following comment: “2020 has been a tipping point for electric vehicle uptake and demonstrates what can be achieved when Government works closely with business fleets to develop a set of powerful grants and tax incentives and invest in a robust public charging network. The latest BVRLA data shows that the fleet sector continues to lead the charge towards zero emission motoring, with battery electric vehicles responsible for 21% of company car registrations in the three months to October 2020.
“Unfortunately, if we zoom out and look at the big picture, the car market has had a catastrophic year, with new registrations at their lowest level for nearly thirty years. With so much uncertainty surrounding the impact of EU Exit, Coronavirus and the economic downturn, the Government must do everything it can to support the vehicle buyers that underpin the UK’s new car market.
“With the next Budget just weeks away, the Chancellor must continue to ring-fence the long-term grants and tax incentives that make electric vehicles affordable. He must also resist the urge to pile more motoring tax increases on fleets and drivers that have yet to make the transition to zero emission motoring. Many of these businesses and individuals are struggling financially and can’t yet find an electric vehicle that meets their needs or budget.”
James Hind, Founder and CEO of car comparison site www.carwow.co.uk: “The initial lockdowns and subsequent roll-out of Tier 3 and Tier 4 restrictions across such a significant area of the UK have understandably played a large part in the huge decline in new car registrations.
“The majority of new car buyers still want to see and test-drive their new cars before committing to such a substantial financial outlay, and the inability to do that throughout so many months during 2020 has undoubtedly had a huge impact on the industry.
“Car factories across the world being forced to shut down their manufacturing and production back in Spring has also understandably dented the rollout of new vehicles; with dealers having far fewer new cars in stock to choose from, alongside longer waiting times.
“Ultimately, it’s not all doom and gloom regarding the automotive industry and there are many reasons to be hopeful as we charge into 2021. In December for example, users visiting the carwow site and sign ups remained constant, and despite the uncertainty currently clouding the sector as a whole, the number of configurations made during December was up marginally (+1.6%) when compared to November. More notably, we also witnessed an increase from November (+6.5%) in unique enquirers post configuration, indicating an extremely healthy appetite for users across the platform to not only configure and engage with a selection of new cars, but to also go on and enquire with individual retailers and complete a purchase.
“Looking ahead, pent-up demand is expected from consumers hungry to reward themselves for a year of frugality and limited options to spend, and with a far larger choice of electric and plug-in-hybrid cars than a year ago, great deals are currently available from manufacturers and car dealers.”
Lucy Simpson, Head of EV Enablement at Centrica Business Solutions, said: “Despite the uncertainty caused by the pandemic, the 185% year on year increase in the number of EVs on the UK’s roads is encouraging. Barriers to adoption like vehicle choice and range anxiety seem to be disappearing as fleet-operators become more convinced of the benefits of making the switch. A more proactive approach towards sustainability from business is a major reason for this increased appetite for zero emission vehicles.
“Government support for charging infrastructure is also playing a key role and we support a Zero Emission Mandate for car manufacturers to ensure the UK transitions to electric by 2030, but in the interim EV purchase grants should continue.
“Switching to EV also creates an opportunity for firms to shift how they think about energy and become generators, rather than just consumers of energy. For example, using distributed energy technologies like on-site solar generation and battery storage will allow EV operators to generate, store and deploy electricity to EVs directly and sell any surplus energy generated back to the grid. This can unlock new revenue streams and turn energy from a cost into a commodity.”
Ashley Barnett, Head of Consultancy at Lex Autolease said: “Today’s 29% year on year drop really hammers home just how challenging the coronavirus pandemic has been for the motor industry.
“The market will take some time to get back on its feet. How long that is remains to be seen. As we set our sights on recovery in the post COVID global economy, we must remember that accelerating electric vehicle adoption needs to remain at the top of the industry’s New Year’s resolution list if we’re serious about achieving the ambitious Road to Zero targets. The growth in EVs is comforting but ultimately is from an extremely low base – only 6.6% of vehicles on the roads are EVs (including PHEVs).
“All eyes will be firmly on the spring Budget and the rumoured plans for a road pricing scheme which may go some way to recoup lost tax revenue when EVs begin to overtake conventional ICE models. The Chancellor has an opportunity to reassure would-be EV drivers that fiscal incentives will remain on the table and incentivise them to take the first step into alternatively-fuelled vehicles.
“2021 also needs to be the year we discuss, seriously, what the used EV market will look like. In less than three years, we’ll see the 108,205 EVs that were delivered in 2020 enter the used vehicle market. Without some fiscal support to encourage second-hand acquisition, overall growth may stall. Again, government incentives are a crucial part of creating demand in this market – to ensure that EV adoption is a realistic prospect across the whole affordability spectrum.”
Poppy Welch, Head of Go Ultra Low said: “In the context of the new car market, 2020 will be remembered as the breakthrough year for electric vehicles (EVs). After a ninth successive year of growth in EV registrations, we’ve now seen market share rise to 10.7%. This has been made possible, in large part, by the Government’s ongoing support and long-term vision, combined with the automotive industry’s commitment to developing a wide range of zero-emissions vehicles that are clearly convincing the public with their performance, financial and environmental credentials. While only a handful of EVs were on sale in 2011, there are now more than 100 models available.”
