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January 10, 2019 01:00 AM

United Kingdom's new car market declines amid strict environmental policies

European Rubber Journal Report
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    New car sales dropped throughout the United Kingdom in 2018.

    LONDON—The United Kingdom's new car market declined by 6.8 percent in 2018, with annual registrations falling for a second year to 2.36 million units, according to figures released by the Society of Motor Manufacturers and Traders.

    The industry witnessed a sharp 5.5 percent year-on-year decline in December, ending a year of what the SMMT described as "anti-diesel policies."

    "A second year of substantial decline is a major concern," SMMT Chief Executive Mike Hawes said. "Falling consumer confidence, confusing fiscal and policy messages and shortages due to regulatory changes have combined to create a highly turbulent market."

    According to Haws, the industry is facing "ever-tougher environmental targets against a backdrop of political and economic uncertainty." Such circumstances are weakening demand, he warned, adding that "these figures should act as a wake-up call for policy makers."

    Private, fleet and business registrations all fell in 2018, with the biggest losses felt in the fleet sector, which saw a 7.3 percent decline. Private motorists and smaller business operators registered declines of 6.4 percent and 5.6 percent, respectively, in 2018.

    Demand also fell across all vehicle segments bar the dual-purpose category, which grew by 9.1 percent to take more than fifth of the market with a 21.2 percent share.

    Despite registrations of "superminis and lower medium cars" falling by 2.5 percent and 9.4 percent, respectively, though these smaller vehicles remained the most popular with a combined 58.7 percent market share.

    The biggest volume decline was seen in the diesel sector, which was down 29.6 percent in 2018.

    "Anti-diesel rhetoric and negative fiscal measures took their toll, with December marking the 21st consecutive month of decline for the fuel type," the SMMT noted.

    Registration for gas and alternatively-fuelled vehicles rose 8.7 percent and 21 percent, respectively. This, however, was not enough to offset the full shortfall as many diesel owners adopt a "wait and see" approach, the SMMT added.

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