Deloitte comments on SMMT new car registration figures has been saved
Deloitte comments on SMMT new car registration figures
5 February 2020
Michael Woodward, UK automotive lead, Deloitte, said:
“Sales of new cars fell by -7.3% this past month compared to the same time last year. After three consecutive years of declining sales, this news represents a disappointing start to the new year.
“Sales of diesel cars continued to fall (-36.0%) in January, along with sales of petrol (-9.5%). In contrast, battery electric vehicles experienced triple digit growth (+203.9%), while hybrid electric cars (HEVs) increased by +20.6%, and plug-in hybrid electric vehicle (PHEV) demand more than doubled (+111.1%). After a long period of political uncertainty, consumers and businesses have entered the new decade with more optimism. This should be good news for car sales in 2020, but it may take time for the market to catch up.
“This week’s announcement, bringing forward a ban on sales of petrol and diesel cars by five years to 2035, will continue to accelerate the growth of EVs. However, we may see it curb the growing popularity of hybrids. The inclusion of hybrids in the proposal has taken many in the industry by surprise, with significant resources already committed to the technology. This presents a major challenge to manufacturers as many will have to invest heavily in order to meet the adjusted targets.
“Hybrids have traditionally been seen as a stepping-stone to battery electric vehicles. However, with their ban from 2035 putting them in the same category as higher polluting diesel and petrol cars, the question is whether the consumer will continue to see the same benefit in moving to hybrid in the interim?
“According to our latest consumer research, only 48% of consumers plan to buy a petrol or diesel vehicle as their next car – down from 73% in 2018 and 63% in 2019. Meanwhile, 34% of consumers plan to buy a hybrid, and 11% plan to buy an EV. It will be interesting to see how this changes in light of earlier than expected ban of petrol and diesel sales.
“Nevertheless, 2020 should remain a big year for electric, with over 30 new models being released in the UK and consumer confidence in the technology growing. However, the current price of an EV, combined with concerns over charging infrastructure, means that many consumers are questioning whether now is the right time to switch to fully electric. In addition, some concern remains around potential constraints on the supply of EV new models into the UK.”
Notes to editors
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