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| 1 minute read

Stuttering restart to UK vehicle sales with some questions about how and where to stimulate it

It's pleasing to see today's release of June YTD UK car sales data and the uplift since May.  In saying that, the market remains severely depressed.

Buried in the numbers is some insight as to how things really are. Fleet sales, which usually make up well over 50% of all sales, are down significantly. With businesses cutting back and with travel restricted there seems little chance that private buyers will take up the slack.  The pressure along the entire automotive value chain looks to continue.

Diesels (and diesel mild hybrids) only make up 21% of all YTD UK sales where it wasn't so long ago that well over 50% of all cars sold had diesel engines. Conversely, battery electric vehicles are not far away from reaching 5% of all sales - with 30,000 already sold this year.  Added to plug-in hybrids, it means that 8% of all vehicles sold can be driven in electric only mode. Manufacturers alone have spent tens of billions of Euros on electrified power trains, with mostly negative returns so far.  Perhaps 2020 is when take-up accelerates and economies of scale can begin to be had? 

While we can celebrate this uptick in electrified vehicle sales, we know that CO2 emissions are on the rise as people switch from lower CO2/mile diesels to their gasoline equivalents.  This is not a UK-only phenomenon but makes uncomfortable reading for the Government; we should watch carefully to see whether the contents of any stimulus packages announced this week address this and/or the overall pressures on the entire industry.

The latest drop means UK sales for the first six months of the year were roughly half the 2019 total

Tags

auto, restart, uk automotive, electric vehicles

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