Automotive sector

UK auto sector saw weakest July sales in decades

Just over 120,000 new cars were registered in the UK in July, the weakest performance the domestic sector has seen since 2000, the Society of Motor Manufacturers and Traders (SMMT) said.

A combination of supply chain shortages and “pingemia” thwarted attempts to boost sales, with industry estimates for the year being revised down to 1.82 million units.

A total of 123,296 new cars were registered in the UK last month, down 29.5% from July 2020.

But plug-in vehicle purchases reversed the trend, accelerating to 17.1% of the market with 21,039 units registered in July. Electric vehicles are now expected to account for more than one in six new cars acquired in 2021, an increase needed before the ban on the sale of new gasoline cars from 2030.

The SMMT said the most popular car types in Britain remained city cars (32.9% of registrations), lower mid-size (28.0%) and dual-use (27.3%) cars.

As the UK economic outlook continues to strengthen, with most consumer indicators suggesting a greater appetite for spending, including on so-called ‘important’ items, supply issues continue to dampen growth with weaker market conditions which are expected to continue in August.

Mike Hawes, Managing Director of SMMT, said, “The automotive industry continues to struggle with semiconductor and workforce shortages, limiting our ability to translate a strengthening economic outlook into a full recovery.

“The next few weeks will see changes in self-isolation policies, which will hopefully help companies in the industry deal with staff absences, but the semiconductor shortage is expected to remain an issue until at least. the rest of the year.

“As a result, we have slightly lowered the market outlook for 2021. The silver lining, however, remains the growing demand for electrified vehicles as more and more consumers react to these new technologies, driven by a choice of increased products and fiscal and financial incentives. and a pleasant driving experience.

Jim Holder, Editorial Director of the Magazine and Website Which car?, said: “The appetite for buying cars is clearly there, especially as people are rewarding themselves after the lockdown.

“But the challenge for manufacturers and retailers is to manage customer expectations and build pipelines in the meantime when supply is limited.

“Ultimately, the supply issues will lift, but only those who have invested in meeting customer expectations will be able to reap the rewards.”

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