The new car market in the United Kingdom expanded for the sixth consecutive month in January as supply chain concerns afflicting the industry continue to improve, according to industry data released on Monday morning.
Last month, 131,994 new automobiles were registered, up 14.7% from January 2022, according to SMMT.
Electrified vehicles, particularly hybrids, propelled the surge. And 100% battery cars outsell diesel by a wide margin in the first month of the year.
However, experts remain “cautiously hopeful” and warn that the rising expense of living. And the delayed installation of charging stations may eventually dampen demand for plug-in versions.
The most popular model in January was the £31,095 HS plug-in hybrid SUV manufactured by Chinese-backed MG.
In January, hybrid electric car registrations increased by 40.6% compared to the same month in 2022.
Only gasoline (76,216 registrations) outsold conventional hybrids (18,975 registrations) last month.
January car sales rise for a sixth month
Plug-in hybrids remained relatively flat, increasing by only 0.7%; nonetheless, the best-selling MG HS model (3,481 registrations) was among the 9,109 PHEVs that was purchased last month.
Pure-electric car sales rose from 12.5% in January 2021 to 13.1% in January 2022.
A total of 17,294 EVs were sold last month. In comparison, dealers sold just 10,399 diesel cars.
However, pure electric car sales were lower than the typical market share of 16.6% in 2022, even though last year’s battery electric vehicle sales were significantly boosted in the last months due to automakers registering them to fulfill severe yearly CO2 objectives.
SMMT estimates 1.79 million registrations for 2023, up 11.1% from 2022.
However, the delayed deployment of new electric vehicle charging stations. And the impact of the rising cost of living could stifle demand for battery-powered automobiles.
The ratio of new charge station installations to new plug-in automobiles decreased from 1:42 in the last three months of 2021 to 1:62 between October and December of the previous year.
Mike Hawes, chief executive officer of the Society of Motor Manufacturers and Traders, stated: ‘The automotive industry is already bucking the national growth trend and is set, with the proper framework, to accelerate the decarbonization of the UK economy.
MG leads EV sales
‘The industry and market are in transition but are fragile due to a negative economic outlook, rising expenses of living, and customer apprehension over new technologies.
We expect a budget that reaffirms net zero and promotes sector and national green growth.
Ian Plummer, the commercial director of the online vehicle marketplace Auto Trader, stated, “Against a backdrop of economic turmoil, six consecutive months of year-over-year growth for the new car market is cause for celebration, but sales of electric vehicles have returned to earth.”
The demand for new electric vehicles on our market is at a three-year low due to rising energy costs.
They account for less than 10% of new car queries from shops, down from 30% last summer.
Jamie Hamilton, automotive partner and head of electric cars at Deloitte, estimates that one in twenty UK consumers intend to acquire a vehicle within the next three months and that high consumer demand could “continue for the remainder of the year.
However, he also expressed concern about the demand for EVs in the charging network.
‘Electric car sales are solid with a 20% market share this month,’ he said.
To promote EV ownership, EV charging infrastructure must be built.
Wholesale at Barclays Corporate Banking
As January marked the sixth straight month of new car registrations, Karen Johnson, head of retail and wholesale at Barclays Corporate Banking, stated that dealers have a “constant drumbeat of anticipation” in the air.
“With optimistic expectations, reduced supply challenges, and order books being filled,” she said.
Over two-thirds of all BEV/hybrid vehicle purchases are reportedly made by businesses in these electric times of optimism. And while the hope of going green across the board remains, dealers must ask. Will increased costs and demand for charging points discourage private buyers from switching to electric?
Jim Holder, editorial director of the publication What Car?, stated, “Electric vehicles were the story of the year in 2010.”
As the technology continues to command a premium over petrol and diesel vehicles. The cost-of-living problem must be managed if sales are to continue to climb this year.
Sue Robinson, chief executive officer of the National Franchised Dealers Association, added, ‘It is crucial that the transition to zero emissions continues to be supported by investments in the charging infrastructure and financial incentives for EV buyers, as recently addressed in the NFDA’s Spring Budget 2023 submission.
Retailers will increase showroom visitors and online offerings in 2023 to match shopper demand.
