Deloitte comments on SMMT new car registration figures has been saved
Deloitte comments on SMMT new car registration figures
06 April 2021
Michael Woodward, UK automotive lead at Deloitte, said:
“Today’s SMMT figures allow us to compare new car sales across two lockdown periods with March’s sales up by 11.5%, year-on-year, fuelled by business and fleet users. This will be encouraging for the sector, albeit reinforcing the importance of physical dealerships as overall sales remain below pre-pandemic figures.
“For individual purchases, click and collect has proven an important lifeline throughout the pandemic, but sales figures suggest it is not a real substitute for the salesroom floor yet.
“With a new ‘21’ plate and pent-up demand, the re-opening of showrooms later this month should see an enthusiastic return of consumers, many of whom have improved disposable incomes as a result of limited spending opportunities during lockdown.
“If the expected uptick in demand happens, the ongoing shortage of semiconductors could have challenging implications for manufacturers that continue to manage the supply of vehicles to dealers and their customers. Consumers may need to wait longer than expected for the cars they want.”
Jamie Hamilton, head of electric vehicles at Deloitte, said:
“Electric vehicles continue to outperform the sector with battery electric (7.7% market share) and plug in hybrid (6.1% market share) both seeing year-on-year growth. As a result, they hold a combined market share of 13.9% in March.
“However, with cuts to EV subsidies on the horizon, sales are likely to be impacted. Where similar incentives have been reduced in other countries, the sale of EVs subsequently fell.
“Whilst proposed changes will not remove all incentives and many models still remain eligible, communicating the other cost savings of EVs will be of even greater importance now. This might be through benefit in kind taxes, or the overall running costs – including fuel and maintenance - over the course of an EV’s lifetime. Investment in infrastructure also continues to support the rollout.
“Around half of new registrations are fleet and company cars so businesses also have a greater role to play. The value of benefit in kind for electric cars, and the opportunity to structure this through salary sacrifice, will continue to be the main driver of fleet sales, providing an ongoing financial incentive for businesses and their employees to switch.
“For personal purchases, a fully functioning used EV market will be important to maintain take up, particularly amongst cost conscious consumers. Brand new vehicles typically take three years to enter the used car market so incentives for this segment could prove beneficial.”
Notes to Editors
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