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Car industry suffers second worst May in three decades

·3-min read
Only May 2020 – when the UK was in a coronavirus lockdown – was worse for the industry (Peter Byrne/PA) (PA Archive)
Only May 2020 – when the UK was in a coronavirus lockdown – was worse for the industry (Peter Byrne/PA) (PA Archive)

The UK’s automotive industry suffered its second weakest May in three decades, figures show.

Just 124,394 new cars were registered last month, the Society of Motor Manufacturers and Traders (SMMT) said.

That was down 20.6% compared with the same month last year.

It was the second lowest number of new cars registered in May since 1992.

Only May 2020 – when the UK was in a coronavirus lockdown – was worse for the industry.

The SMMT attributed the decline to shortages of components which are reducing vehicle availability “despite demand”.

Registrations of pure electric cars bucked the overall trend last month, with a 17.7% year-on-year increase.

Electrified vehicles such as pure electrics, plug-in hybrids and hybrids accounted for three out of 10 new cars in May.

While there are some signs of dented consumer confidence now dampening car-buying demand from its recent highs, the main issue in the new car market lies with supply rather than demand with most brands and dealerships boasting bulging orderbooks and buyers typically waiting many months for deliveries

Ian Plummer, Auto Trader

SMMT chief executive Mike Hawes said: “In yet another challenging month for the new car market, the industry continues to battle ongoing global parts shortages, with growing battery electric vehicle uptake one of the few bright spots.

“To continue this momentum and drive a robust mass market for these vehicles, we need to ensure every buyer has the confidence to go electric.

“This requires an acceleration in the rollout of accessible charging infrastructure to match the increasing number of plug-in vehicles, as well as incentives for the purchase of new, cleaner and greener cars.

“Delivering on net zero means renewing the vehicles on our roads at pace, but with rising inflation and a squeeze on household incomes this will be increasingly difficult, unless businesses and private buyers have the confidence and encouragement to do so.”

Ian Plummer, commercial director at automotive classified advertising business Auto Trader, said: “Today’s weak new car figures underline the lingering challenges for carmakers, as the war in Ukraine adds to the headwinds of a post-Covid shortage of semiconductors, and lockdowns in China.

“Even though the microchip shortage is easing a little, manufacturers are struggling to source critical components like wiring looms, which are a major Ukrainian export and hard to replace.

“While there are some signs of dented consumer confidence now dampening car-buying demand from its recent highs, the main issue in the new car market lies with supply rather than demand with most brands and dealerships boasting bulging orderbooks and buyers typically waiting many months for deliveries.”

Alex Buttle, co-founder of used car marketplace Motorway.co.uk, said electric vehicle sales “provide a beacon of hope to the car market that things aren’t all doom and gloom”.

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