New car registrations in the UK for May 2024 showed a modest increase of 1.7%, but don't break out the champagne just yet – private buyers are still giving showrooms the cold shoulder.
Another Month, Another Marginal Increase
Well, folks, it's that time again. The monthly car sales figures are in, and surprise, surprise – we're up! But before you start planning a ticker-tape parade, let's put this 1.7% increase into perspective. We're still about a fifth down on pre-Covid numbers, so maybe hold off on popping those corks.
Fleet and Business to the Rescue
Once again, it's the fleet and business buyers keeping the UK car market afloat. Fleet sales surged by 14%, while business sales weren't far behind with a 9.5% increase. Meanwhile, private buyers seem to be treating car showrooms like they're radioactive, with sales plummeting by a whopping 12.9%. It's almost as if regular folks have decided that maybe, just maybe, they don't need a new car every other Tuesday.
The Great Fuel Type Shuffle
In the ongoing soap opera that is fuel type popularity, we've got some winners and losers. Diesel and petrol, the old guard, are continuing their slow march into obscurity with another drop in sales. But fear not, eco-warriors! PHEVs (that's Plug-in Hybrid Electric Vehicles for those of you not fluent in alphabet soup) are having a moment with a 31.5% increase. Regular hybrids are also up by 9.6%, presumably because people like the idea of being green without the commitment of actually plugging in their car.
EVs: The Elephant in the Showroom
Now, here's where things get interesting. EV sales are up 6.2% overall. Sounds great, right? Well, not so fast. In a whole year, the market share of electric cars has risen by a whopping... 0.7%. That's right, less than one percent. At this rate, we'll hit the government's target of 22% EV sales sometime around the heat death of the universe.
But wait, it gets better. That minuscule increase in EV sales? It's all thanks to fleet and business buyers. Private buyers are actually buying fewer EVs than last year, with a 2% drop. In fact, over 80% of EV sales are now to fleet and business customers. It's almost as if regular people aren't thrilled about the idea of spending a small fortune on a car that might leave them stranded if they dare to drive more than 200 miles in one go.
Discounts Galore (But Nobody's Buying)
Now, you might be thinking, "Surely with all these discounts on EVs, people must be snapping them up!" Well, you'd be wrong. Despite some truly eye-watering price cuts – we're talking a Peugeot e-2008 slashed from £40k to £24k, and a Jaguar i-Pace down from £80k to £50k – private buyers are still saying "thanks, but no thanks."
It's almost as if people have realized that a car that loses half its value faster than a block of ice in the Sahara might not be the wisest investment. Who knew?
The SMMT Speaks (And We Try Not to Laugh)
Mike Hawes, the Chief Executive of the SMMT (Society of Motor Manufacturers and Traders), had this to say:
"As Britain prepares for next month's general election, the new car market continues to hold steady as large fleets sustain growth, offsetting weakened private retail demand. Consumers enjoy a plethora of new electric models and some very attractive offers, but manufacturers can't sustain this scale of support on their own indefinitely. Their success so far should be a signpost for the next government that a faster and fairer transition requires carrots, not just sticks."
Ah yes, Mike, because what we really need is more government incentives for EVs. Because the massive discounts currently on offer are clearly working so well, aren't they? It's not like people are looking at the huge depreciation on EVs and running for the hills or anything.
The Bottom Line
So, what have we learned from May's car sales figures? Well, it seems that fleet and business buyers are keeping the UK car market on life support, while private buyers are staying away in droves. EVs are still struggling to gain traction with the general public, despite discounts that would make a Black Friday sale look stingy.
The government's target of 22% EV sales this year is looking about as achievable as me winning the next Olympics. Car makers are facing the prospect of some hefty fines if they don't meet this target, which I'm sure they're thrilled about.
As for the future? Well, unless the next government decides to start handing out free EVs with every pack of digestive biscuits, it's hard to see how we're going to hit these ambitious EV targets. But hey, at least the fleet managers are happy, right?
In the meantime, if you're in the market for a new car, you might want to check out those EV discounts. Just make sure you've got a very, very long extension cord.
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