Car industry looks to 2021 with hope despite sales falling by more than a quarter

New car sales were down by more than a quarter last month, new figures reveal, but industry leaders are putting on a brave face heading into 2021.

The Society of Motor Manufacturers and Traders (SMMT) said 113,781 new registrations were recorded across the UK last month, nearly 43,000 fewer than during November 2019 – a fall of about 27 per cent. Picture: Lisa Ferguson

The Society of Motor Manufacturers and Traders (SMMT) said 113,781 new registrations were recorded across the UK last month, nearly 43,000 fewer than during November 2019 – a fall of about 27 per cent.

Trade has not been this poor since the 2008 recession, after showrooms in England were forced to close for most of November due to the latest coronavirus lockdown, though click and collect orders were processed.

SMMT chief executive Mike Hawes said: “Compared with the spring lockdown, manufacturers, dealers and consumers were all better prepared to adjust to constrained trading conditions.

“But with £1.3 billion worth of new car revenue lost in November alone, the importance of showroom trading to the UK economy is evident and we must ensure they remain open in any future Covid restrictions.

“More positively, with a vaccine now approved, the business and consumer confidence on which this sector depends can only improve, giving the industry more optimism for the turn of the year.”

Private demand fell by 32.2 per cent last month, while the number of new cars added to larger fleets was down 22.1 per cent.

Sales of pure battery electric and plug-in hybrid cars continued to buck the overall trend, with surges across the UK of 122.4 per cent and 76.9 per cent respectively.

James Fairclough, chief executive of AA Cars, said: “Looking ahead to 2021, the government’s plan for a mass vaccination programme has buoyed expectations that the industry will be able to trade more normally.

“The tougher question will be how the pandemic’s economic fallout will affect people’s willingness to purchase big ticket items like a brand new car. Electric vehicles could be the secret ingredient that lures drivers back to the forecourts.”

Karen Hilton, chief commercial officer at heycar, noted: “Throughout the pandemic, dealers have worked hard to engage with customers via digital channels primarily - getting their stock online, offering video viewings and free delivery. This is new ground for a lot of dealerships.”

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