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UK new car market sees weakest March for 24 years as fleet sales decline

Date: 05 April 2022   |   Author: Sean Keywood

The UK new car market recorded its weakest March sales performance since 1998 last month, according to the Society of Motor Manufacturers and Traders (SMMT), with registrations down by 14.3% year-on-year.

The organisation said the disappointing performance - the worst seen for the month since March became one of two crucial number plate change months per year - was down to ongoing supply chain shortages, especially of semiconductors, leaving manufacturers unable to meet demand.

With around 20% of the UK's annual new car registrations normally recorded in March, the SMMT called the figures "massively disappointing", and said it demonstrated the long-term effects of the Covid-19 pandemic on the industry.

The year-on-year figures showed a particular drop in fleet registrations, which were down by 34.4% compared with March 2021, taking 40.8% of the overall market. In contrast, private sales were up by 8.2% - the previous March having seen showrooms affected by Covid-19 lockdown measures - for a 56.4% market share, while business sales - classed as to fleets with fewer than 25 vehicles - rose by 20% for a 2.8% share.

The fuel mix figures showed it was another good month for battery EV sales, up by 78.7% year-on-year with 39,315 registrations - the most ever seen in a single month, and for context more than were registered in the whole of 2019, giving EVs a 16.1% share of the overall market. These figures were boosted by a big month of registrations for Tesla, with its Model Y and Model 3 taking the top two positions on the monthly sales chart.

In contrast, plug-in hybrid registrations were down year-on-year by 7.5%, taking a 6.6% market share, while conventional hybrids performed more strongly, up by 28.4% for an 11.4% share.

Mild hybrid petrols were up by 4% for a 13.4% market share, but mild hybrid diesels plummeted by 50.3% for a 4.8% share.

That still wasn't as bad as the performance of pure diesel cars, down by 55.2% for a 5.6% share, while pure petrols were down by 25.6%, though with a 42% market share these were still easily the most popular choice overall.

SMMT chief executive Mike Hawes said: "March is typically the biggest month of the year for the new car market, so this performance is deeply disappointing and lays bare the challenges ahead. 

"While demand remains robust, this decline illustrates the severity of the global semiconductor shortage, as manufacturers strive to deliver the latest, lowest emission vehicles to eagerly awaiting customers. Placing orders now will be beneficial for those looking to take advantage of incentives and lower running costs for electric vehicles, especially as the Ukraine crisis could affect supply still further. 

"With increasing household and business costs, the government must do all it can to support consumers so that the growth of electric vehicles can be sustained and the UK's ambitious net zero timetable delivered."