New car registrations slumped to their lowest January level in half a century as lockdown measures and the forced closure of showrooms stifled demand, the auto industry’s trade body said on Thursday.
Sales fell 39.5 per cent year-on-year to 90,249 sales in the month – the lowest recorded since 1970, according to data from the Society of Motor Manufacturers and Traders (SMMT).
Sector insiders said the near 40 per cent slide was as good as could be anticipated, given that England and Scotland have been under the toughest lockdown restrictions since 5 January – and said the success of ‘click and collect’ services shows there is still plenty of appetite for new models.
And one of those cars in high demand during lockdown is the Vauxhall Corsa. The maker’s latest supermini has overtaken the Ford Fiesta – the UK’s best seller for 12 years running – to become the most-bought motor so far in 2021.
The latest coronavirus lockdown has stifled demand for new car sales at the start of 2021 and looks set to limit vehicle purchases during February too
Car showrooms have been forced to close their doors to the public since the start of the year, which was always going to limit vehicle sales volumes in January.
The 90,000 new models that have been purchased so far in 2021 were predominantly bought online or over the phone and collected outdoors at dealers’ sites in a socially-distanced manner.
This is the new reality for those working in vehicle sales during the pandemic and looks set to be the case throughout February.
The industry is now pinning hopes on customers being allowed back in showrooms from March, which is also one of the top two car-selling months of the year – and accounts for one in five new car registrations for the year on average – due to the change in the licence plate series.
The industry is now nervously pinning hopes on a recovery from March, when showrooms might be allowed to re-open and consumers who have been saving during the pandemic look to start loosening their purse strings
Andrew Burn, head of automotive at KPMG said March would be the ‘most critical tests for the sector’, given it will be the first time during the pandemic that we have seen a lockdown running for so long into a plate change month.
‘In March 2020 there would have been orders in the system ahead of the lockdown, so it is most likely that this base level of orders will not be there to the same level this quarter,’ he said.
The SMMT is urging MPs to allow the opening of dealerships as soon as it is safe to do, saying it will ‘help re-energise consumer confidence, supporting jobs and a green recovery’.
Mike Hawes, the trade body’s chief executive, said: ‘The necessary lockdown will challenge society, the economy and our industry’s ability to move quickly towards our ambitious environmental goals.’
He added: ‘Every day that showrooms can safely open will matter, especially with the critical month of March looming.’
Sue Robinson, chief executive of the National Franchised Dealers Association (NFDA) said that retailers are ‘optimistic about the year ahead, provided that dealerships will be allowed to reopen as soon as it is safe to do so’ and that there is a ‘proportion of consumers waiting for dealerships to reopen and holding off their vehicle purchases due to the current restrictions’.
She added: ‘Showrooms have spacious areas and dealers can work by appointment ensuring the safety of customers and staff.’
The 90,249 new cars registered last month is the lowest in January for half a century, the SMMT confirmed this morning
Registrations were down across the board, with the influential fleet sector posting a year-on-year decline of almost 40%
The NFDA’s positive outlook for 2021 was reiterated by Karen Johnson, head of retail at Barclays Corporate Banking, who said that sellers will be expecting consumers who have ‘built up savings during the pandemic to start committing again to big ticket purchases like a new car’.
The SMMT said the effect of the current lockdown will have to be taken into account for its full-year outlook for the market.
Having expected more than two million new cars to be registered in 2021, this forecast has now been downgraded to below 1.9 million given the more severe negative impact on first quarter performance and March in particular.
Despite the downgrade, the forecast represents an increase of 15.7 per cent compared to 2020’s ‘lost year’. However, it would still be a ‘very subdued market in historical terms’, given the 10-year average new car market to 2019 was 2.3 million registrations.
Corsa takes early sales lead in 2021
With 3,078 registrations in January, the latest Vauxhall Corsa has taken an early lead ahead of its biggest rival, the Ford Fiesta, in 2021.
The Ford has been the best-selling new model in Britain for the last 12 years straight, though sales of the new Corsa had been higher towards the end of 2020.
The Fiesta was not only outsold by the Corsa but also the Kia Sportage and British-built Nissan Qashqai.
A new version of the latter is expected to be unveiled this month – and for the first time there will be a Qashqai e-Power hybrid version too.
With over 3,000 registrations, the new Vauxhall Corsa (right) has taken an early sales lead in 2021. Ford’s Fiesta – the UK’s best-selling car for the last 12 years – dropped down the order to 4th spot in January, also outsold by the Kia Sportage and Nissan Qashqai
Electric car sales continue to be the shining light for the sector
Models powered entirely by electricity – referred to as battery electric vehicles (BEV) – recorded an increase in sales of 54,4 per cent, with 2,206 registered in January.
It means almost seven per cent of all new cars bought last month were electric – nearly 14 per cent if you add plug-in hybrid vehicles to the equation.
Korean car maker, Kia, said one in six models it sold in the UK last month were electric – the biggest proportion of zero-emission vehicle transactions it has ever recorded.
With just over 11,000 registrations, January 2021 was the worst month for diesel sales since dealers were allowed to start selling cars again in June 2020
Kia said that 1 in 6 new cars it sold in January were electric models, like the e-Niro SUV pictured
The ongoing growth in ultra low emission vehicles continues to prompt significant falls in average car CO2 emissions, the SMMT says.
Combined with ongoing improvements to petrol and diesel engines, average vehicle CO2 dropped to 112.8g/km in January – a reduction of 11.8 per cent compared to 2019 and 37.7 per cent compared to 2000.
That isn’t to day last month was a good one for petrol and diesel cars – quite the contrary, in fact.
The fuel types recorded respective losses of 62.1 per cent and 50.6 per cent in January 2021.
With just 11,083 diesel registrations, the RAC points out that it was the worst month for diesel sales since car showrooms were allowed to reopen since dealerships were allowed to reopen in June 2020.
‘It remains to be seen what the rest of 2021 will bring when it comes to drivers’ appetite to opt for diesels, and whether the numbers sold will ever return to pre-Covid levels,’ spokesman Rod Dennis said.
The decline in petrol and diesel sales and the record uptake of electric vehicles has seen average CO2 outputs of new models plummet in the last year
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