Plunging diesel sales depress new car sales for 2018

Plunging sales of diesel cars pushed the UK new car market down by 6.8% in 2018, with annual registrations falling for a second year to 2,367,147 units, according to figures released by the Society of Motor Manufacturers and Traders (SMMT).

Diesel sales were down 29.6% in 2018, with December marking the 21st consecutive month of decline for the fuel type. Growth in registrations of petrol cars (8.7%) and alternatively fuelled vehicles (20.9%) was not enough to offset the shortfall.

In the AFV sector, petrol electric hybrids remained the most popular choice, up 21.3% to 81,156 units. Plug-in hybrids (PHEVs) also recorded a strong uplift (24.9%) over the year, though the figures suggest growth is slowing following the removal of the Government’s plug-in car grant for these vehicles in October.

Demand for PHEVs grew almost 30% in the first 10 months, but year-on-year increases fell to 3.1% and 8.7% in November and December. Pure electric cars grew 13.8% in the year but, with just 15,474 registered, they still make up only 0.7% of the market. SMMT said that following the reduction in government incentives, the pace of growth of plug-in cars is now falling significantly behind the EU average.

SMMT also published data showing the UK new car fleet average CO₂ rose for a second successive year, by 2.9% to 124.5g/km. While part of this fleet average CO₂ increase was due to segment shift and the introduction of the new, more onerous WLTP test which produces higher figures, it said the move away from diesels is having a significant impact.

SMMT chief executive Mike Hawes said: “A second year of substantial decline is a major concern, as falling consumer confidence, confusing fiscal and policy messages and shortages due to regulatory changes have combined to create a highly turbulent market. The industry is facing ever-tougher environmental targets against a backdrop of political and economic uncertainty that is weakening demand so these figures should act as a wake-up call for policy makers.

“Supportive, not punitive measures are needed to grow sales, because replacing older cars with new technologies, whether diesel, petrol, hybrid or plug-in, is good for the environment, the consumer, the industry and the exchequer.

“Despite the overall decline in 2018, demand for new cars in the UK remains solid, with volumes on a par with the preceding 15-year average, and the market is still the second biggest in the EU, behind Germany. It is also one of the most diverse, with buyers able to choose from some 350 different models available in fuel types and body styles to suit all driving needs.

“Meanwhile, more than 80 exciting new generation models – 31 of them plug-in electrics – are set to make their showroom debuts in 2019, and with some compelling deals on offer, the industry is continuing to invest to grow the market despite the headwinds.”