UK car sales slide for a sixth month amid falling consumer confidence

car sales

Trade body blames Brexit uncertainty and confusion over air quality plans after sales of new diesel cars fall by more than a fifth.

New car sales in the UK fell for a sixth month in September, leaving the market on course for its first annual decline since 2011, The Guardian reports.

Car registrations dropped by 9.3 per cent to 426,170, the first time the September market has declined in six years. The Society of Motor Manufacturers (SMMT) and Traders blamed declining consumer confidence given uncertainty over Brexit and confusion over air quality plans. Sales of diesel cars crashed by 21.7 per cent last month.

eptember, when number plates change, is a key month for car sales. New car registrations have fallen 3.9 per cent over the first nine months of 2017 and are expected to record a fall over the year as a whole.

The SMMT had been expecting an annual decline because previous years were strong, but it now looks as though that drop may be bigger than expected, a spokeswoman said.

Rebecca Long-Bailey, Labour’s shadow business secretary, said: “This is an economy being driven into the ditch. This is worrying not only for the car industry but speaks to a deeper economic malaise with anaemic economic growth figures this year and real wages lower than 10 years ago. The country desperately needs a bold, transformative industrial strategy.”

Richard Jones, the managing director of motor finance firm Black Horse, part of Lloyds Banking Group, said: “With the new 67 plates now available, September was an important month for the industry and today’s figures reflect the general slowdown across the market.”

Sales of diesel cars have been falling for six years and if this trend continues, CO2 emissions from new vehicles could rise this year for the first time since average CO2 emissions in Britain were first recorded in 2000, the SMMT said.

Diesel vehicles were long promoted as being cleaner than petrol cars but recent research suggests that they could be worse for causing carbon emissions. Tax breaks have favoured diesel over petrol, even though they are a leading emitter of the air pollutants nitrogen oxides (NOx), which is responsible for an estimated 70,000 premature deaths in Europe each year.

This year, the UK government announced that it would ban all new petrol and diesel cars and vans from 2040. It followed a similar announcement in France.

Mike Hawes, the SMMT chief executive, said: “September is always a barometer of the health of the UK new car market so this decline will cause considerable concern. Business and political uncertainty is reducing buyer confidence, with consumers and businesses more likely to delay big-ticket purchases.”

He noted that a car is usually the second-largest big-ticket item for consumers, after a property.

“The confusion surrounding air quality plans has not helped, but consumers should be reassured that all the new diesel and petrol models on the market will not face any bans or additional charges,” he added.

“Diesel clearly offers benefits in terms of fuel economy and for many customers fuel economy is an important thing,” he said.

The biggest declines in September were seen at opposite ends of the market with sales of luxury saloons and superminis falling 36.4 per cent and 21.2 per cent respectively.

Demand from business, fleet and private buyers all fell in September, down by 5.2 per cent, 10.1 per cent and 8.8 per cent respectively.

Demand for new vans dropped 4.2 per cent in September to 57,368, driven by a fall in sales of smaller vans. Sales of pick-ups and heavier van sales rose slightly.

Credit insurance firm Euler Hermes predicts new UK car sales will fall 5 per cent this year to 3m vehicles and 6 per cent in 2018 to 2.8m after five years of growth. The US is the only other global market that will experience declines. Overall, the firm predicts that global vehicle sales will reach 100m by 2019, driven by strong demand in China and India.

Sue Robinson, the director of the National Franchised Dealers Association, said: “Consumers walking into the showroom need more clarity on issues such as diesel and air quality. We are working closely with car retailers to assist them in educating their customers.”