Forty per cent fall in demand for diesel pushes new car sales down by nearly 16 per cent in March
The ongoing onslaught against diesel cars continues to push down UK sales, with sales for new cars slumping by 16 per cent in March.
Demand for diesel was down nearly 40 per cent compared with the same month last year, while alternatively fuelled vehicles (AVFS) were up 5.7 per cent . Demand for petrol was up 0.5 per cent.
The declining figures represent a snapshot of an industry struggling with uncertainty around Brexit, decline in diesel demand and a particularly strong March last year, when buyers seized the chance to purchase cars before new Vehicle Excise Duty (VED) rates came into force that April.
However, this March was till the fourth biggest ever for the sector. Registrations are still running at a historically high level.
The Society of Motor Manufacturers and Traders (SMMT), which conducted the research, said economic and political uncertainty had negatively impacted consumer confidence, as had “confusion over air quality”.
“The decline in demand for diesel cars continues to be of concern and the latest tax changes announced by the government do nothing to encourage consumers to exchange their older diesel vehicles for new lower emission models,” it said.
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Electric vehicles capitalised on this trend, with demand for plug-in hybrids driving growth, up 18.2 per cent for the month. Registrations of petrol cars were stable, up 0.5 per cent. Dual purpose vehicles were the type to fare the best, thanks to Britain’s recent bout of heavy snow, with only 713 fewer vehicles sold this March compared to last March.
It said demand from business, fleet and private buyers all fell in March, down 14.3 per cent, 15 per cent and 16.5 per cent respectively.
SMMT chief executive Mike Hawes said: “March’s decline is not unexpected given the huge surge in registrations in the same month last year. Despite this, the market itself is relatively high with the underlying factors in terms of consumer choice, finance availability and cost of ownership all highly competitive.
“Consumer and business confidence, however, has taken a knock in recent months and a thriving new car market is essential to the overall health of our economy. This means creating the right economic conditions for all types of consumers to have the confidence to buy new vehicles. All technologies, regardless of fuel type, have a role to play in helping improve air quality whilst meeting our climate change targets, so government must do more to encourage consumers to buy new vehicles rather than hang onto their older, more polluting vehicles.”
Ian Gilmartin, Head of retail & wholesale at Barclays corporate banking, added: “Car sellers shouldn’t be too disheartened – the industry is still producing very high quality products, with most cars, including diesel models, more environmentally friendly than ever. If manufacturers and the motor supply chain can retain their focus on the future, they will be able to help retailers attract drivers back to the showrooms.”
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