The UK new car market rose by 2.5% in July with electrified vehicles dominating demand, according to the latest figures from the Society of Motor Manufacturers and Traders (SMMT).
Electrified vehicle demand outpaced the overall market, accounting for four in 10 (42%) new cars registered in the month. Hybrid electric vehicle (HEV) uptake increased by 31.4% to achieve a 14.5% market share, while plug-in hybrids (PHEV) grew 12.4% to take 8.9% of registrations.
Battery electric vehicle (BEV) volumes were up 18.8%, resulting in an overall market share of 18.5%, around 3.5% below the mandated zero emission target for 2024.
With 147,517 new cars reaching the road, it was the best performance for July since 2020, when a re-opening of dealerships following four months of lockdown saw a surge in deliveries to fulfil demand pent-up demand.
As has been the pattern for the year, July’s growth was sustained entirely by the fleet sector, which recorded a 13% increase in registrations to achieve a 62% market share.
Private BEV volumes did increase by a marginal 0.9% with overall, BEVs account for 16.8% of the new car market, year to date.
With zero emission vehicles mandated to comprise a minimum 22% of each brand’s new car registrations over the full year, the pace of transition needs to increase, the SMMT said.
While the outlook anticipates overall market growth in 2024, expectations have been revised downwards since April, with 1.968 million new car registrations now forecast by the end of the year.
Last week’s interest rate cut was already ‘priced in’ to the latest outlook but further cuts would be welcome, helping reduce the costs of finance and making new car purchases more accessible to more consumers, the SMMT said.
Mike Hawes, SMMT Chief Executive, said:
“Two years of new car market growth against a backdrop of a turbulent economy is testament to the sector’s resilience and the attractiveness of the deals on offer. Weakening private retail demand, however, particularly for EVs and despite generous manufacturer discounts, is the over-riding concern.
“More people than ever are buying and driving EVs but we still need the pace of change to quicken, else the UK’s climate change ambitions are threatened and manufacturers’ ability to hit regulated EV targets are at risk. Achieving market transition at the pace demanded requires greater support for consumers and, with the all-important new numberplate month of September beckoning, action on incentives and infrastructure is needed now.”
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