Increased business confidence drives May new car sales

New car registrations in May saw an eight-fold increase in May with 156,737 vehicles registered compared to May last year with showrooms temporarily closed because of the pandemic.

The market was driven by fleet which rose twice as fast as the private sector as the commercial sector accelerated the long-postponed renewal of company cars. Large fleets accounted for 50.7% of all new vehicles hitting the road.

Although the performance in May looks striking it is down -14.7% on pre-pandemic May 2019, and -3.2% on the 10-year May average, according to SMMT figures.

In terms of segments, dual purpose vehicles saw a small decline in market share in the month, down to 26.7%, leapfrogged by lower medium cars which rose to 27.8%. Superminis remained Britain’s most popular car choice, with a 31.1% share.           

Battery electric vehicle (BEV) market share declined from 12% a year ago to 8.4% in the past month, although the May 2020 performance was distorted by lockdowns when new cars could only be purchased through click and collect or delivery, giving rise to variable purchasing patterns.

Looking more broadly across 2021, plug-in vehicles now comprise 13.8% of new car registrations, up from 7.2% a year earlier, with the most rapid growth seen in plug-in hybrid (PHEV) derivatives. Pure petrol and mild hybrid petrol cars so far account for 60.4% of registrations, while pure diesel and mild hybrid diesels took a 18.0% share year to date, compared to 64.6% and 22.4% last year.

Year to date registrations are down -29.1% than the average recorded across January to May during the last decade.

Mike Hawes, SMMT chief executive, said: “With dealerships back open and a brighter, sunnier, economic outlook, May’s registrations are as good as could reasonably be expected.

“Increased business confidence is driving the recovery, something that needs to be maintained and translated in private consumer demand as the economy emerges from pandemic support measures.

“Demand for electrified vehicles is helping encourage people into showrooms, but for these technologies to surpass their fossil-fuelled equivalents, a long-term strategy for market transition and infrastructure investment is required.”