More cars were registered in the UK than ever before in 2016, the market reaching almost 2.7 million.
Despite sales slipping in December, only the second month of the year to record a negative result, the market saw its fifth consecutive year of growth.
According to new figures released by the Society of Motor Manufacturers & Traders (SMMT), 178,022 new cars were registered in December, 1.1% down on the same month in 2015.
However they contributed to a year-long total of 2,692,786 – 2.3% up on 2015 and a new record for the UK market.
The SMMT, which at the start of 2015 predicted that the market would “hold steady” in 2016 after soaring 6.3% in 2015, put the current strength in car sales down to fleet demand.
Fleet registrations grew to a record 1.38 million units, and while the private market remains high , with more than 1.2 million private buyers registering a new car in 2016, demand did fall after the first quarter of 2016.
Meanwhile the popularity of diesel cars is continuing to slip. They were down 6.8% in December, claiming 47% of the market compared to 49.8% a year before, and have slid back slightly over the year, holding 47.7% (2015 – 48.5%).
More buyers going electric
The appeal of alternatively fuelled vehicles (AFVs) is still climbing strongly, up 22.2% across the year. Plug-in hybrids and petrol electric hybrids, in particular, experienced significant growth, with demand up 41.9% and 25.1% respectively, while more than 10,000 motorists chose to go fully electric in 2016 – up 3.3% on 2015.
According to SMMT chief executive Mike Hawes, the market grew despite 2016’s political and economic uncertainties, and he puts this down to car makers offering “an incredible range” of innovative and high tech models.
“2017 may well be more challenging as sterling depreciation raises the price of imported goods but, with interest rates still at historic lows and a range of new models arriving in 2017, there are still many reasons for consumers to consider a new car in 2017,” Hawes says.
And continuing to focus on the Brexit process, Hawes adds; “Looking longer term, the strength of this market will rest on our ability to maintain our current trading relations and, in particular, avoid tariff barriers which could add significantly to the cost of a new car.”
