UK car sales last year hit a six-year low and the industry does not expect an early recovery but Welsh buyers were most loyal, writes Robin Roberts.
The SMMT said today that overall sales in 2019 were 2.4% below the previous year at 2.31M new models.
Consumer confidence, confusion over clean air legislation which is tightening each year and challenging car makers, and the Brexit debate with a general election, combined to suppress demand.
A drop in buyers choosing diesel hit planning and sales while the electric models are in short supply and high prices put off some.
December marked the 33rd month of sales decline for diesels and tax changes have impacted on Benefit in Kind payments and added another barrier which partly explains the 34.4% cut to business registrations.
On a positive note, alternatively fuelled vehicles surged to lift their share to 7.4% with hybrids dominating while pure battery models rose 144% overtaking plug-in hybrids after tax concessions were lifted for the PHEVs.
Behind the sales there is concern as the average CO2 emissions for all models sold rose 2.7% to 127.9gkm due to lost diesel sales, tougher measuring criteria and changing buyer habits towards SUVs.
Even so, the most popular new models bought last year were superminis and lower medium sized cars which took over 57% of registrations despite their slipping to demand for SUVs.
However, the year ended with December registrations up 3.4% and battery models soaring 220.7% in the month as total registrations for all new cars approached 149,000.
Overall sales last year in UK were 2,311,140, about 2.4% below 2018.
Welsh new car buyers snapped up 79,158 new models last year, a dip of under 1% from 12 months earlier.
It was the lowest decline across the UK as dealers enjoyed continuing support from buyers helped by competitive pricing and incentives in Welsh dealerships. December registrations in Wales rose 8.72% to 4,874 models.
Describing the slowdown as a significant concern for the industry, SMMT chief executive Mike Hawes said, “A stalling market will hinder industry’s ability to meet stringent new CO2 targets and, importantly, undermine wider environmental goals.
“We urgently need more supportive policies: investment in infrastructure; broader measures to encourage uptake of the latest, low and zero emission cars; and long term purchase incentives to put the UK at the forefront of this technological shift.
“Industry is playing its part with a raft of exciting new models in 2020 and compelling offers but consumers will only respond if economic confidence is strong and the technology affordable.”
Sue Robinson, Director of the National Franchised Dealers Association, added, “In 2019, the decline in new car registrations was partially offset by a strong used car market which provided profit opportunities for retailers who, in turn, offered excellent deals to their customers.
“NFDA hopes that a more stable political environment will support the automotive retail sector and restore consumer confidence in 2020”.
James Fairclough, CEO of AA Cars went on, “Dealers will want to gain some momentum quickly in the first quarter, and any deals and special offers they can provide will go a long way to attracting motorists back to the forecourts.
“Looking ahead, hopefully 2020 will see the continued growth of electric and hybrid vehicles. Their sustained growth provided a positive thread throughout 2019, with drivers showing great enthusiasm for environmentally-friendly cars.”