Sales of new EVs hold up well despite 20% auto market slump

New electric car sales held up well in September taking a 17% share of the market – despite new car registrations dropping 20% overall compared to the same month last year.

The cost of living crisis is clearly hitting the UK’s car market, with sales of petrol cars down 27% and diesel cars down 21% in terms of actual sales volume year-on-year, according to statistics released by New AutoMotive.

Hybrid and pure electric registrations were both down by 9% in the same period, however electric vehicles market share still increased by 2% compared to September 2021. 

Ben Nelmes, Head of Policy and Research at New AutoMotive, said: “Electric cars have secured an impressive share of the market, with 17% of all new UK cars fully electric in September. 

“New car registrations overall were down by 20% in September, as the ongoing cost of living crisis takes a toll on the new car market. Consumers and businesses may be delaying or rethinking large purchases and investments. While the recent turbulence in financial markets is unlikely to have had much impact on September’s sales figures, they may prove to be an issue going forwards as the cost of financing the purchase of a new car increases with interest rates.

“So far, 2022 has seen weaker new car sales figures than 2020, when the Covid-19 pandemic was at its peak. Any drop in sales of EVs makes it harder for the UK to meet its carbon budgets and slows efforts to reduce our reliance on expensive, imported fuels. It is welcome to see that EV sales are holding up so well given the current headwinds in the market.”

“Electric cars charged at home on a standard variable tariff are over 40% cheaper to run per mile compared to petrol and diesel alternatives. As the cost of living crisis continues to hit new car sales, more and more consumers may choose to go electric because of the savings EVs offer, insulating drivers from the worst of the market downturn.”

UK market overview

September was a disappointing month for total UK car sales, which were down 20% year-on-year. September is usually a very strong month for new car registrations, but according to New AutoMotive the 27% year-on-year fall in petrol car registrations this year’s figures puts 2022 as the weakest year since at least 2016, and weaker even than the pandemic years. This is likely to be primarily due to reduced consumer spending, but factors such as global supply chain disruptions and the extra bank holiday also weigh on sales. 

Table 3 provides a full UK market overview.

So far this year, electric car registrations are faring well, with more sold so far this year than at this point in any year previously. Electric car registrations are still growing strongly, and out-performing any year previously by a wide margin. The last few months of the year typically see very strong EV registrations as manufacturers delay some deliveries and bring forward others to meet their obligations under CO2 regulations. 

September’s EV sales were slightly down on the previous year’s; this could be a result of global supply chain disruptions or weaker consumer spending. New AutoMotive have seen some evidence that the lease cost on some electric vehicles has ticked up in the last week; this could be due to recent turbulence in UK financial markets or anticipation of future interest rate increases. It is unlikely that this played any role in September’s sales figures, since this happened at the end of the month, but it could be an issue for October’s sales data.

Images and tables courtesy of New AutoMotive. Featured image courtesy of Shutterstock.

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