FT ford fiesta 2018

The Ford Fiesta was the top selling model in October

The UK new car market recorded a third month of growth in October, with registrations rising by more than a quarter (26.4%) to 134,344 units, according to the latest figures from the Society of Motor Manufacturers and Traders (SMMT).

However, the increase is against very weak sales in October 2021 when deliveries fell by 24.6%. In the year to date, the market is down 5.6% on the same period in 2021, and is still a third below pre-Covid levels.

Zero-emission-capable car deliveries continued to grow in volume, with battery electric vehicle (BEV) registrations increasing by 23.4% to 19,933 and plug-in hybrids (PHEVs) by 6.2% to 8,899.

However, BEV uptake grew by less than the overall market for the first time since the pandemic, meaning October is the first month to see BEV market share fall year on year since May 2021. According to SMMT this was primarily attributable to supply challenges.

Deliveries of hybrid electric vehicles (HEVs), meanwhile, rocketed 81.7% to account for more than one in 10 new cars, as supply was prioritised for a raft of popular new models. Overall, electrified vehicles accounted for one in three registrations, while more than a fifth (21.5%) came with a plug.

Sales of petrol cars were up 17.8% last month to 56,994, giving them a market share of 42.4%, compared with 14.8% for BEVs. Registrations of diesel cars were down 9.7% to 7,028 and a market share of 4.7%.

SMMT said supply chain shortages, surging inflation and a growing cost of living crisis have led to a 2.2% downward revision of the market outlook for the year, with 1.566 million registrations now anticipated.

This puts 2022 on course to be the market’s weakest year since 1982. Demand for electric vehicles is anticipated to result in a plug-in market share of 21.9% rising to 26.7% of registrations next year.

Despite Ford announcing that it would be discontinuing production of the Fiesta next year it was the top selling model in October. However, its lead over the Nissan Qashqai in second place was tiny – 4,230 vs 4,228 – and it does not figure in the top ten for the year to date.

SMMT chief executive Mike Hawes said: “A strong October is hugely welcome, albeit in comparison with a weak 2021, but it is still not enough to offset the damage done by the pandemic and subsequent supply shortages. Next year’s outlook shows recovery is possible and EV growth looks set to continue but, to achieve our shared net zero goals, that growth must accelerate and consumers given every reason to invest. This means giving them the economic stability and confidence to make the switch, safe in the knowledge they will be able to charge – and charge affordably – when needed. The models are there, with more still to come; so must the public chargepoints.

“With stretched infrastructure and the cost of living crisis both having the potential to undermine future uptake, government’s Autumn Statement, set for 17 November, provides an opportunity to stimulate demand and deliver both economic growth and net zero progress. Further measures to mitigate energy costs in the longer term for consumers and businesses would give greater confidence. Now is not the time to raise motorists’ costs, which would likely stoke inflation and damage broader government revenues from new car sales. A long-term fiscal commitment to zero emission motoring would do much to stimulate investment and demand. EV drivers’ top complaints are, invariably, cost and charging anxiety so reducing VAT on public charging to bring it into line with home charging would level the playing field for drivers unable to install a home chargepoint.”

“The increase in new vehicle sales in October demonstrates the resilience of franchised dealers and their ability to find the right deal for their customers and the importance of supply finally reaching forecourts,” said Sue Robinson, chief executive of the National Franchised Dealers Association (NFDA), which represents franchised car and commercial vehicle retailers in the UK.

“The transition to electric vehicles, as evidenced by the continued increase in EV sales, will create opportunities for the motor retail sector. The UK government must continue to act to support this transition and the wider UK automotive sector, one of the UK’s largest and most important industries.”

Chris Evans, head of sales at heycar, commented: “Rising interest rates and the highest mortgage rates that we’ve seen in 14 years are making consumers far more cautious when it comes to their next big purchase.

“In conversations with our dealer partners during the past month, we know that stock is sticking to forecourts for longer than it has done compared to the rest of the year. In some areas it is becoming apparent that stock is clearly taking longer to be sold, with dealers advising of strong pricing actions being required.

“EV demand has been dented by uncertainty around energy prices and the scrapping of the two-year price guarantee. However, while EV leads are down 21% compared to October last year, demand for petrol and diesel has increased by a respective 52% and 19%. Hybrids are also up 63% on the same month in 2021.

“Large and practical cars have been among the most popular in October. Based on the number of leads that we are sending to our dealer partners, demand for SUVs is up 43% on October 2021, while estate cars have also experienced an uptick with demand up 49%. This suggests that demand for large and practical family vehicles is as strong as ever.

“Most dealerships predict they will be able to weather this storm, as no new car stock and steadfast used car pricing means that dealer profits will remain strong despite the recent economic downturn. If the government and the newly appointed Prime Minister can tackle the huge job of boosting consumer confidence, the market in 2023 should be in a better state than it will be after a difficult end of year.”

Kim Royds, EV director at British Gas, said: “Despite ongoing supply chain disruptions continuing to stall the availability of new models, another consecutive month of growth in EV registrations is a positive step as the UK accelerates along the road to zero.

“Widespread adoption of EVs is dependent on the supporting charging network being easily accessible and able to withstand the increased demand. Tackling charging challenges – both at home and in public spaces – is critical if the UK is to stay ahead of the electrification curve and ensure that nobody is excluded from EV ownership.”