April new car sales results (for what it’s worth)

Although hardly surprising, the stark reality of the numbers makes for painful reading and points to an industry in deep trouble.

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New car registrations for April have been published today, although there’s really not a lot of point discussing the specifics in any great detail. Private new car sales were down 99% as a result of the coronavirus lockdown.

With dealerships all closed and car buyers stuck at home, just over 4,000 new cars were registered in April 2020. That’s a 97% reduction compared to more than 160,000 in the same month last year. Fewer than 900 of those vehicles were bought by private customers, who were presumably key workers in urgent need of a new car.

According to the Society of Motor Manufacturers and Traders (SMMT), which compiles the data each month, you have to go all the way back to February 1946 to find a worse month for new car sales. Although this is hardly surprising, the stark reality of the numbers makes for painful reading.

April 2020 new car registrations | The Car Expert
Source: SMMT

The car industry will be profoundly altered

Today’s numbers have highlighted the impact of the coronavirus shutdown on the car industry. Unlike groceries or small retail goods that can still be delivered by Amazon and other services, the automotive retail industry has ground to almost a complete halt in the last six weeks.

Despite the publicity tales of car companies making ventilators and other medical equipment for the NHS, the reality is that the UK car industry has already lost billions of pounds as a result of the global economic shutdown. The losses accrued to date will almost certainly kill off some familiar names or important suppliers once government furlough and other support funds run out. The longer this situation lasts, the more likely it is that we will see some genuinely big players collapse.

Unsurprisingly, the car industry is calling for car dealerships to be part of the first wave of businesses allowed to re-open, to try and get sales back up and running as soon as possible. Of course, thousands of other industry sectors are also clamouring to re-start operations so the government will be juggling economic goals with the need to keep everybody healthy.

The rest of 2020 is a guessing game

The SMMT has revised its overall 2020 forecast down (again) to less than 1.7 million new car registrations, which is well down on last year’s 2.3 million registrations. However, at this time any forecasting seems like glorified guessing until we know how and when the industry will be able to re-open.

We can safely assume that May is going to be another write-off. Even if the government allowed dealerships to re-open tomorrow, it would still take weeks to get things back up to full speed – and that’s on the hopeful assumption that customers start pouring back in again. No-one is certain how quickly the car manufacturers will be able to ramp up to anything like full production again, especially since their supply chains are global and different parts of the world are in different stages of lockdown.

The other question is one of customer demand. How many people (assuming they still have jobs) are going to celebrate the end of lockdown by rushing out to buy a new car? How many businesses, having watched their cash burning away while the bills keep piling up, are going to rush out to renew their fleets?

Even if the dealers are open, it seems likely that most buyers are likely to hold off until at least the next new registration plate month of September. Realistically, they may well put off any new car purchases for even longer while they wait to see what the post-coronavirus world looks like. There have been suggestions that concerns about social distancing will lead to more people driving cars instead of using public transport, which could help car sales, but economic reality will still be the main determinant for most people.

A bizarre top ten

As with the overall data, analysing the top ten best-sellers list is rather pointless. The entire new car market for April wouldn’t have made the top ten in March, so declaring winners and losers has no meaning at all.

Only two models in this month’s top ten list are regular best-sellers, with the Vauxhall Corsa in third place and the Mercedes-Benz A-Class in eighth. Other than that, it’s a strange old list – mostly defined by a few fleet deliveries.

Interestingly, some Tesla and Jaguar dealers were able to deliver a handful of electric vehicles despite the nationwide lockdown. This created an even more abnormal picture of the overall results. The Tesla Model 3 and Jaguar I-Pace took the top two places, although the numbers were still tiny.

To be fair to Tesla, the Model 3 has been selling very well and has made a couple of appearances in the top ten since it was launched last year. But names like the Ford Tourneo Custom (a Transit van with seats) and Peugeot Rifter (a smaller van with seats) are rather alien to most car buyers.

It’s also interesting that three of the top ten vehicles are dedicated electric cars (with the new Vauxhall Corsa also available as an electric model) given that fuel prices are the lowest they’ve been for years. But this may be more a function of delivery logistics than customer demand, so we won’t read anything more into it than ‘interesting’.

We will still run our monthly feature on the ten best-sellers later this week, mainly for visitors who are interested to read about some different models to the usual top ten than for any kind of analysis.

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Stuart Masson
Stuart Massonhttps://www.thecarexpert.co.uk/
Stuart is the Editorial Director of our suite of sites: The Car Expert, The Van Expert and The Truck Expert. Originally from Australia, Stuart has had a passion for cars and the automotive industry for over thirty years. He spent a decade in automotive retail, and now works tirelessly to help car buyers by providing independent and impartial advice.

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