New car sales in the UK fell by 34.9% year on year in June. Society of Motor Manufacturers and Traders (SMMT) announced that there is a significant improvement over April and May (down 97% and 89% respectively) but is far from target comeback after more than two months of low sales.
Mike Hawes, SMMT chief executive described June’s new car sales as “not a recovery and barely a restart.” “Many of June’s registrations could be attributed to customers finally being able to collect their pre-pandemic orders, and appetite for significant spending remains questionable,” he added.
In June, there were 145,377 new cars sold; a decline of 78,044 units compared to June last year. For the year to date, the market has fallen by almost half (48.5%), with 653,502 new cars sold in the first six months making it the lowest level since 1971.
While the decline certainly reflects economic uncertainty, many of the UK-wide retailers are not open yet. Only English dealerships were open for the full month. Welsh and Scottish showrooms have delayed reopenings. One in five retailers remains shut and reports suggest upwards of 30% of sales staff remain on furlough in England.
Meanwhile, the irregularities of the top 10 best-selling cars from the past few months has started to normalise in June, with the Vauxhall Corsa and Ford Fiesta, back at number one and two spots respectively. This is in stark contrast when the Tesla Model 3 – never before even listed in the top 10 – became the best-selling car, with 658 sold in April. The electric Model 3, however, remains at number nine in June’s top sellers
Tesla has managed to grow UK sales in the first six months of 2020 and is just one of two manufacturers to do so. The other is MG, the underdog which has been off the radar for most UK buyers. MG’s ZS EV – another electric car, has recorded its best June volume which sold 2025 cars and a record monthly market share of 1.4%.
The Chinese-owned MG year-to-date sales are up a quarter slowly distancing ahead of Dacia, Lexus and Mitsubishi in the sales charts and putting it within reach of Fiat, Mazda and Suzuki, which are all less than 1000 sales ahead, according to the SMMT figures.
The growing demand for plugin-vehicles has contributed to the success of both Tesla and MG even before the pandemic affected the market. Plug-in hybrids and electric vehicles held more market share than ‘regular’ hybrids in June, while pure EVs had a 6% share, with sales up by 262%, the equivalent of 8903 cars.
Meanwhile, diesel-powered car sales, which have been steadily decreasing over the past few years because of the backlash following Volkswagen’s Dieselgate scandal, now account for less than a fifth of sales. In June, only 23,011 diesel vehicles were sold compared to 87,896 petrol vehicles. Petrol makes-up 60.5% of overall market share. By comparison, in 2016, diesel car sales accounted for almost half of the total volume.
Given the market uncertainty caused by the ongoing Coronavirus pandemic, it’s no surprise that vehicle sales fell by massive 45.2% in June, which the SMMT attributed to “businesses pausing purchasing amid expenditure reviews”. Private demand was more resilient, falling 19.2% compared with June 2019 and accounting for more than half of the overall market.
Nonetheless, car dealers remain cautious about the following year. Jardine Motor CEO Neil Williamson described its sales in June as “better than our worst-case scenario”, adding: “Let’s wait and see if it continues.”
Here at Carzam we believe that consumers in the UK have sat on their hands during the April & May meaning when the showrooms opened in June dealers were always going to see a spike in sales with some dealers recording record months.