The UK new car market declined by 4.6% year-on-year in May, according to the latest figures from the Society of Motor Manufacturers and Traders (SMMT).
SMMT attributes the decline to continued uncertainty over diesel and clean air zones, as well as the removal of incentives for plug-in hybrid vehicles. Continued economic and political instability also continue to affect consumer and business confidence.
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Declines were recorded across all sales types in May, with registrations by private consumers, fleets and business buyers declining by 5%, 3% and 29% respectively. Executive and dual purpose vehicles bucked the trend of falling demand, with registrations growing 9.1% and 16%.
Petrol cars saw a slight 1% growth in registrations, while the 11.7% increase in alternatively fuelled vehicle registrations was not enough to offset the significant decline in demand for diesel cars, which fell for the 26th consecutive month.
Petrol-electric hybrids saw demand increase 34.6% to 7,785 units in the months, while battery electric cars experience a significant rise of 81.1%. However this segment still represents just 0.6% of the overall market. Plug-in hybrids continued their fall in popularity, dipping 40.6% in May and 25.1% year-to-date.
Mike Hawes, chief executive of SMMT, said: “Confusing policy messages and changes to incentives continue to affect consumer and business confidence, causing drivers to keep hold of their older, more polluting vehicles for longer.
“New cars are safer, cleaner and more advanced than ever and, with sophisticated safety, efficiency and comfort features as well as a host of attractive deals on offer, there has never been a better time to invest in a new car.”
Sue Robinson, director of the National Franchised Dealers Association, added: “Pleasingly, despite the decline in new vehicle sales the used car market continues to perform strongly demonstrating that the consumer still has options when it comes to purchasing vehicles. Franchised retailers continue to benefit from the growing used vehicle market and the associated aftersales segment.”
