Private new car sales were down by 10% in May as supply shortages combined with cost of living concerns to limit new car spending.
According to data published this morning by the Society of Motor Manufacturers and Traders (SMMT), private new car registrations were down 10% in May compared to the same month last year. Combined with fleet registrations being down by 30%, this meant the overall market was down by just over 20%.
Year-on-year comparisons are still difficult to judge, as both 2020 and 2021 were badly affected by factory shutdowns and dealership closures thanks to the Covid-19 pandemic. But even allowing for the steady decline in new car sales since 2016, it’s clear that the market is still down on where we’d expect it to be.
Car makers prioritising private buyers over fleets
Car manufacturers continued to prioritise retail customers ahead of fleet buyers in May, as they have been doing for most of this year. That’s good news for waiting times for consumers, but not so good for customers leasing a new car through a broker or large leasing company.
In a time of restricted production, car makers are enjoying the benefits of selling more cars to retail customers, who pay full price (or close to full price) rather than fleets who expect massive discounts in return for buying thousands of vehicles. This also affects the types of cars sold, as private buyers tend to prefer smaller cars, SUVs and EVs while fleets tend to (proportionally) buy more plug-in hybrids, diesels and larger cars.
Electric cars still marching forward
The current market conditions are also helping the sale of electric vehicles, through a combination of car companies prioritising them, customers wanting them and fewer supply chain hold-ups.
Plug-in hybrid sales were flat, as were regular hybrids. Both have basically maintained market share in line with previous months this year, but are not growing as fast as fully electric cars. This is not hugely surprising, as most of the big nee developments in electrified models are targeted at full EVs rather than partial EVs.
Diesel’s market share trundles along at about 10-11%, and seems to have levelled out for the time being after five years of falls. Petrol’s market share is now starting to gradually slide as buyers switched to electrified vehicles, although it remains the dominant player in the new car market with more than half of all registrations.
Good month, bad month
Despite an overall market fall of 20%, some brands coped better than others – largely a function of how many semiconductor chips they have been able to secure to keep building cars. Overall, Ford has re-establised itself at the top of the market with another solid month, bouncing back after a terrible end to last year. Kia continues to hold second place overall, ahead of Audi, Volkswagen and BMW.
Compared to the overall market, it was a good month for Abarth, Alfa Romeo, Alpine, Bentley, Citroën, Cupra, Dacia, DS Automobiles, Ford, Hyundai, Kia, Maserati, MG, Mini, Nissan, Polestar, Porsche and Smart. All of these brands outperformed the market by at least 10%.
However, life wasn’t so rosy for Fiat, Honda, Jaguar, Jeep, Land Rover, Lexus, Mazda, SEAT, Skoda, Subaru, Suzuki, Volkswagen and Volvo, who all underachieved by at least 10% against the rest of the market.
As we’ve warned previously, supply issues will continue to plague the new car market for at least the rest of this year, so we’ll continue to see some topsy-turvy results.
Corsa on course
With five months of the year down already, the Vauxhall Corsa is gradually edging clear in the race for the UK’s best-selling car of 2022 after returning to the top of the sales charts in May.
Similarly, the second-placed Ford Puma is edging away from the Nissan Qashqai in third, while the Mini hatchback has overtaken the Kia Sportage for fourth place in year-to-date sales.
The Volkswagen Golf made a comeback, reappearing in the top ten for the first time in a few months. Going in the other direction, the Mercedes-Benz A-Class has now fallen out of the top ten in year-to-date sales after another slow month.
We’ll have our full analysis of the top ten in the next few days.
