Deloitte comments on SMMT new car registration figures has been saved
Deloitte comments on SMMT new car registration figures
5 November 2020
Michael Woodward, UK automotive lead at Deloitte, said:
“New sales fell year-on-year by 2% in October according to today’s figures from the SMMT.
“Consumer spending continues to show resilience as demand from private buyers was flat compared to the same period last year. However, a year-on-year decline in the fleet sector of -3% has impacted overall performance, suggesting that business confidence needs to improve to accelerate recovery.
Consumer spending on a knife edge
“Whilst private sales have returned to near pre-pandemic levels, today’s national lockdown measures will see showrooms close their doors once again.
“The impact of a second lockdown is likely to be significant, but the industry is better placed to cope this time around with many dealers and manufacturers improving their online presence, alongside continued trade in service and parts businesses.
“However, uncertain economic conditions and the prospect of further unemployment means consumers continue to put off major purchases. Dealers and manufacturers will have to work hard to convince prospective buyers that they are getting value for money when restrictions eventually lift.
Business confidence holding back a recovery
“Typically accounting for more than half of all new car sales in the UK, we may have to wait several months for fleet sales to return to pre-pandemic levels as CFOs prolong their expectations for a full recovery. Deloitte research found more than 60% now expect demand to remain below pre COVID 19 levels until the second half of next year or beyond.
EVs come to the fore
“October was another excellent month for electric vehicles, with Battery Electric (BEV) and Plug in Hybrid (PHEV) growing their combined market share to 12% compared to just 4% last year. Both BEVs and PHEVs saw growth this month, of 195% and 149% respectively, edging closer to overtake diesel sales (-38%).
“As we await further details on the ban of polluting vehicle sales, the pressure is now on the UK’s charging infrastructure to keep up. Maintaining coordination with charging infrastructure planning will be needed to create sustainable growth and meet the government’s targets. We need to see a joined up approach that considers what kind of chargers are needed and how many, and what the underlying power networks look like.
Brexit back on the agenda
“As the end of the UKs transition period with the EU nears, there is an increased focus across the automotive sector on Brexit preparation, with future supply and inventory a growing concern for many.
“For consumers, the availability of cars should improve as manufacturers build up their UK stock prior to Brexit which could, in turn, see increased discounting in the New Year.”
Notes to editors
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