UK new car sales fell to their second weakest May in the last thirty years as a lack of consumer confidence and supply chain chokepoints took their toll on the big-ticket purchases.
Just 124,000 cars were registered in May of this year, the lowest of the last thirty years except for the pandemic-induced lows of 2020.
The closely-watched index from the Society of Motor Manufacturers and Traders (SMMT) suggests ongoing supply issues – with electric batteries and other key parts currently lacking – is now being matched by a fall in demand as potential buyers are put off buying high-value items amid an ongoing cost of living crunch.
The boss of AA Cars said the combination was threatening a “perfect storm” for new car sales.
James Fairclough also warned that supply issues were not a short-term phenomenon.
“The supply problems show little sign of abating, as lockdowns in China and the war in Ukraine exacerbate the shortage of key materials like steel and semiconductors, and hold back levels of car production,” he said yesterday.
Traders did see an uptick in the sale of electric battery vehicles, up almost 20 per cent year on year.
Mike Hawes, the SMMT’s chief executive, said the performance of new greener cars in the market was one of the “few bright spots” in the data.
To continue this momentum and drive a robust mass market for these vehicles, we need to ensure every buyer has the confidence to go electric. This requires an acceleration in the rollout of accessible charging infrastructure to match the increasing number of plug-in vehicles,” he said yesterday.
In separate data, the SMMT also confirmed van sales had closed May in their fifth straight month of decline, with the market more than a fifth smaller than in the period immediately preceeding the pandemic.