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UK new car sales fell 9pc in July

UK new car registrations fell by nine per cent to 112,162 last month, according to the latest figures from the Society of Motor Manufacturers and Traders.

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The Nissan Qashqai was the top selling car in the UK in July

It was the fifth consecutive month of decline, although the percentage fall in July was the smallest recorded this year.

Land Rover bucked the trend with 4,840 sales – up 49.3 per cent on the year, but Jaguar was down three per cent at 1,249.

MG, which is based at Longbridge but has its cars made abroad, was up 27.5 per cent to 3,076.

Volkswagen was the top seller nationally at 10,183 – down 18.2 per cent – and the Nissan Qashqai was top model at 2,514 followed by Mini at 2,410.

Ongoing global supply chain issues, predominantly the lack of semiconductors, continued to frustrate order fulfilment, exacerbated by Covid lockdowns in key manufacturing and logistics centres in China, plus disruption from the war in Ukraine, all of which restricted production output and thus supply into the UK new car market.

Declines were driven primarily by an 18.2 per cent fall in registrations by large fleets, to 50,014 units, while consumer registrations remained steady at 59,847 units. As a result, private registrations in the year to date are now 3.7 per cent up on 2021 as manufacturers prioritise private customers.

Battery electric vehicle uptake grew 9.9 per cent to 12,243 to achieve a 10.9 per cent market share for the month.

The outlook for the full year has been revised downwards to 1.6 million new car registrations – a 2.8 per cent fall on 2021, with the industry facing its most challenging year for three decades. Around two million registrations have been lost since Covid, effectively representing a loss of a year’s registrations.

SMMT chief executive Mike Hawes said: “The automotive sector has had another tough month and is drawing on its fundamental resilience during a third consecutive challenging year as the squeeze on supply bedevils deliveries. While order books are strong, we need a healthy market to ensure the sector delivers the carbon savings government ambitions demand. The next Prime Minister must create the conditions for economic growth, restore consumer confidence and support the transition to zero emission mobility.”

James Fairclough, chief executive of AA Cars, said: "Another month, another fall in new car sales. After June’s miserable sales figures - the lowest recorded in June for over a quarter of a century - July’s poor performance is a bitter pill to swallow.

“The steadily improving sales of EVs are a rare crumb of comfort in a mostly grim set of sales data, and the second half of the year is off to a weak start. However, the overall slowdown in sales does come amid some more positive signs of recovery in the supply of new cars for sale."

Alex Buttle, co-founder of used car marketplace, commented: “Although the outlook still appears gloomy, in reality, you'd expect new car sales to drop over the summer months in the run-up to plate changes in September. Add to that the continued chip shortage crisis, the ongoing war with Russia and low consumer confidence in the economy and it should be no surprise new car sales continue to decline. EV sales are still weathering the storm - despite lengthy wait times of up to a year, there’s still growing demand to go electric and avoid rising fuel costs and any future expansion of clean air zones.”

John Wilmot, chief executive of car leasing comparison website LeaseLoco, added: “Now the market is facing a new problem in the form of weakening buyer demand, as the cost of living crisis begins to bite."

“The worry for the car industry won’t be that consumers might opt right now to postpone big ticket purchases like a new car, it’s how long for?

“Families are having to look much further down the road at what they’re potentially facing in terms of higher living costs.

“Energy bills are likely to rocket during the winter months. And while millions of mortgage payers on fixed rate deals haven’t seen their monthly payments rise just yet, many of those deals will end in the next 6-12 months.

“The new car market may need to batten down the hatches a little while longer, as there could be a perfect storm heading its way.”

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