UK car sales have surged to over one million units for the first time since the pandemic, driven by the popularity of hybrids and plug-in hybrids.
- June saw 179,263 new vehicles registered, a 1% year-on-year increase, despite overall growth slowing down.
- Hybrid and plug-in hybrid cars have significantly outpaced fully electric vehicles in sales.
- Demand from private buyers has fallen to a historic low, with fleet and business buyers driving the market.
- The transition to lower-emission vehicles is supported by policy incentives, yet the market faces challenges.
The UK car market has experienced a notable resurgence, surpassing one million sales for the first time since the pandemic began. This recovery has been largely driven by the increasing popularity of hybrid and plug-in hybrid vehicles, which have outpaced the sales of fully electric cars.
In June alone, 179,263 new vehicles were registered—a modest 1% increase compared to the same period last year. Despite this slight deceleration in overall growth, the first half of 2024 showed a 6% rise in new car sales compared to the same period last year, totalling 1,006,763 units. However, this figure remains 20.7% lower than pre-pandemic levels in 2019.
A significant shift in buyer demographics has emerged, with private purchasers now accounting for a historically low 38% of the market. In contrast, fleet and business buyers are increasingly capitalising on fiscal incentives and subsidies to invest in lower-emission vehicles. Mike Hawes, Chief Executive of the Society of Motor Manufacturers and Traders (SMMT), has praised the market’s ongoing recovery post-pandemic but warned of future challenges. He emphasised the necessity for supportive policies to revitalise the shrinking private consumer market and expedite the transition to zero-emission vehicles. Hawes stated, “The private consumer market continues to shrink against a difficult economic backdrop, but with the right policies in place, the next government can re-energise the market and deliver a faster, fairer zero-emissions transition. All parties are agreed on the need to cut carbon, and replacing older fossil fuel-based technologies with new electrified powertrains is the essential step to achieving that goal.”
Petrol engine-only vehicles continue to dominate the market, although their share fell to just over 50% in June. Battery electric vehicles saw a 7.4% increase in sales, accounting for 19% of the market that month. For the first half of the year, electric vehicles constituted 16.6% of the market, a slight increase from 16.1% during the same period last year. This shift is partly attributed to major brands reducing their petrol vehicle supplies to boost electric vehicle sales. Notably, Ford and Stellantis, which includes Vauxhall, have both scaled back on petrol vehicle supplies to avoid fines under the new zero-emissions vehicle mandate, which requires 22% of each manufacturer’s deliveries to be electric in 2024, leading to significant sales declines for these companies.
Tesla, the UK’s historic leader in electric car sales, experienced a near 12% decline in sales. This downturn was somewhat counterbalanced by a surge in sales of electric vehicles from Chinese manufacturers such as MG and BYD, with MG capturing nearly 4.3% of the market and BYD showing robust growth.
Despite these challenges, there has been a discernible shift towards lower-emission vehicles, with hybrids and plug-in hybrids showing substantial sales increases. Plug-in hybrid sales surged by 30% in June, capturing over 9% of the market, while hybrid sales rose by 27%, accounting for nearly 15% of the market.
The UK car market’s recovery post-pandemic, spearheaded by hybrids and plug-in hybrids, signifies a major shift towards lower-emission vehicles, albeit amidst ongoing challenges.
