The UK automotive sector has suffered its worst March new car registrations result since 1998, with Society of Motor Manufacturers and Traders (SMMT) chief executive Mike Hawes stating that it “lays bare the challenges ahead”.
Registrations declined by 14.3% year-on-year to 243,479 units in the car retail sector’s key number plate change month to leave Q1 registrations down by 1.9% despite a rollback of the COVID-19 pandemic restrictions experienced by the sector at the start of 2021.
The SMMT this morning (April 5) highlighted that it was the worst March performance since the introduction of the two-plate system and expressed concerns about the outlook for the year, given that around 20% of total annual registrations are usually recorded in the month.
“While demand remains robust, this decline illustrates the severity of the global semiconductor shortage, as manufacturers strive to deliver the latest, lowest emission vehicles to eagerly awaiting customers.
“Placing orders now will be beneficial for those looking to take advantage of incentives and lower running costs for electric vehicles, especially as the Ukraine crisis could affect supply still further.
“With increasing household and business costs, government must do all it can to support consumers so that the growth of electric vehicles can be sustained, and the UK’s ambitious net zero timetable delivered.”
AM recently highlighted the impact of Russia’s invasion of Ukraine in a special news insight report.
The conflict has ended many car retailer’s hopes of a return to free-flowing vehicle supplies in 2022 following ongoing issues with the supply of components, including semiconductor microchips, to the sector’s OEMs.
The SMMT suggested that March’s continued registrations decline “underscores the long-term impact the pandemic is wreaking on the industry”.
Car retailers’ order books remain full, with many dealers telling AM that consumer demand has remained resilient as soaring inflation out the squeeze on household finances.
However, private registrations grew by just 8.2% last month, despite showrooms having remained closed during the March 2021 trading period as a result of social distancing regulations.
Large fleet registrations declined by 34.4% but business registrations grew by 20%.
EV registrations rose 78.7% overall, to 39,315, as zero-emission models secured a 16.1% market share.
Plug-in hybrid (PHEVs) registrations declined by 7.5% to 16,037 units, but hybrids (HEVs) grew 28.4% to 27,737 units.
This means that comprised more than a third (34.1%) of all new car registrations.