New car registrations are up for a sixth month in a row as strong hybrid electric vehicle sales and high interest in car-to-car vehicles boosted demand, but charging adoption has not kept pace, the industry warns.
New car registrations rose 14.7% year-on-year to 131,994 units in January, according to the Society of Automobile Manufacturers and Traders (SMMT). This is the best start to the year for the UK automotive industry since January 2020.
Hybrid electric vehicles (HEVs) accounted for 14.4 percent of new passenger car registrations. However, battery-powered electric models only accounted for 13.1% compared to an annual share of 16.6% in 2022.
Industry experts expect plug-in cars to account for more than a quarter of all new registrations this year, up 32% from last year.
However, the SMMT warned that the expansion of the charging infrastructure required for vehicle traffic has not kept up with them. Last year, a public charger was installed for every 53 newly registered plug-in cars, the lowest number since 2020.
The introduction of mandatory charger deployment targets and the introduction of standards for public charging services will give motorists the confidence to always find a working charger, SMMT said. Otherwise, “poor supply threatens to delay the transition to electricity,” she added.
Mike Howes, CEO of SMMT, said: “The automotive industry is already showing growth contrary to the national trend and is poised to accelerate the decarbonization of the UK economy, given the right foundation.
“We are reviewing the budget, which reaffirms the commitment to achieve zero emissions and provides for actions that contribute to the green growth of the industry and the country.”
Jamie Hamilton of Deloitte said: “Vehicle sales remained strong at the start of the year, with new registrations up 14.7% m/m in January. With about one in 20 British consumers planning to buy a car in the next three months, strong consumer demand could continue through the end of the year.
“After setting a monthly sales record in December, EV sales remain strong with a market share of 20% this month. “
He said building the infrastructure to meet the demand for electric vehicle charging is still a challenge, and the key will be to mainstream electric vehicle ownership. “Easier access to charging points, especially for consumers who cannot park on the street, will be essential for future growth,” he added.
“Consumers often cite price as one of the main barriers to switching to electric vehicles. If you lower it by improving the access and availability of charging infrastructure, EV ownership becomes more profitable.”
Chris Knight of consulting firm KPMG said the new registration numbers are a sign that the automotive market is gaining momentum. “Automakers enjoyed a period of higher profits due to low availability of new vehicles, which also pushed up the cost of used cars,” he said.
“As supply issues begin to ease, coupled with lower household spending for most buyers, we are seeing a more competitive environment and a return to better deals and discounts in the new car market. It also reduces the cost of used cars.
“We look forward to launching many new car brands in the UK in the coming months and will continue to expand consumer choice at all budget levels.”
Meanwhile, German automaker BMW is in talks for a £75 million grant from the Automotive Transformation Fund to enable production of electric Minis at its Oxford plant.
Last October, BMW announced that production of its Mini hatchbacks and small electric SUVs would be moved to China. Production of the electric Countryman will begin at the plant in Leipzig, Germany.
Source: I News
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