Fleet registrations back up – but for how long?
Things might be turning around, finally (but slowly).
According to the latest statistics from the Society of Motor Manufacturers and Traders (SMMT), fleet and company car registrations grew more than twice as fast as private purchases last month.
82,872 new vehicles were registered to business and fleet in May, more than a 1% increase on registrations in May 2020, during the initial throes of Coronavirus.
It’s good news on the whole, but don’t expect miracles on the back of a global pandemic.
Overall decline on pre-pandemic May
Those figures still represent a 21% overall decline on the numbers in pre-pandemic May 2019. It’s a similar story on the year-to-date statistics too, with a 50% increase on 2020’s January to May registrations – but a 29% decline on the same period in 2019.
That being said, the total number of new car registrations for May alone was only 15% down on May 2019 – perhaps a sign that as the year goes on, and as restrictions loosen further, things might be starting to look up.
SMMT chief executive Mike Hawes said: “Increased business confidence is driving the recovery, something that needs to be maintained and translated in private consumer demand as the economy emerges from pandemic support measures.
Demand for electrified vehicles is helping encourage people into showrooms, but for these technologies to surpass their fossil-fuelled equivalents, a long-term strategy for market transition and infrastructure investment is required.”
How does the market share look?
Right now, Superminis are the UK’s most popular car choice, with a 31% market share. Battery electric vehicles (BEVs) dropped 4% in terms of market share, to 8%.
May 2020’s performance numbers were a little distorted though because new vehicles could only be ordered via click and collect or home delivery though.
Plug-in vehicles are performing better now, with last year’s 7% market share doubling to 14% in May 2021. Diesels are down from 22% in 2020 to an 18% market share in 2021, and pure petrol and mild hybrid petrol vehicle registrations have also dropped by 5%.
Permanently longer replacement cycles?
Automotive lead at KPMG, Richard Peberdy, said: “Despite some caution, there are signs that sales are rip for recovery in the longer term. The average age of vehicles on our roads is at a record high, suggesting many drivers will be looking to switch soon, and inventory shortages in the used-vehicle market should push motorists towards new models.
“The picture is particularly encouraging for future plug-in sales, with an increasing supply of attractive electric and hybrid options for consumers to choose from. And we’re likely to see a further boost to the strong momentum behind electric and hybrid vehicle sales in comparison to diesel, a trend that the SMMT data continues to track.”
With 376,000 fewer new cars on the road in the first five months of May 2021 than there were in 2017, fleets are currently older and less efficient across the UK.
But will replacement cycles be permanently extended or does this merely mean we can expect huge growth in new car registrations during the next couple of years, once there are fewer pandemic-related concerns to face? Let us know what you think at [email protected].
