CEO Update

Electric car sales defy pandemic hit market

10 December 2021 #CEO Update

After four months of consecutive decline, new car registrations increased by a modest 1.7% in November. Whilst welcome news, the performance belies the underlying weakness of the market, which remains some -31.3% down on the pre-covid five-year average and is measured against a locked-down November 2020. This is further evidence, therefore of the ongoing disruption caused by global supply chain shortages, most obviously in semiconductors, a shortage in itself the result of the pandemic.

The LCV market, however, continued its rollercoaster year, recording its best-ever November with over 31,000 vehicles registered, up over 11% on the pre-pandemic November average. Demand is clearly robust, but market volatility is likely to remain a feature as supply chain shortages throttle the sector’s ability to fulfil orders.

More positively, the number of new battery electric cars registered last month more than doubled while plug-in hybrids also increased by almost 40%. Over the year-to-date, one in six new cars registered is capable of being plugged in, and, when combining BEV and PHEV with hybrid electric vehicle registrations, more than a quarter of the new car market has been electrified, underscoring the rapid shift taking place.

This success is testament to the ever-growing range of products coming to market. Yet the pace of UK public charging infrastructure is struggling to keep up, with just one on-street public charger for every 16 plug-in vehicles in the UK at the end of 2020, a deterioration from the one in 11 the year before.

We need urgent action to address this crucial issue, with binding public on street charger targets so that everyone, not just those who have a driveway, can be part of the electric vehicle revolution.

This week also saw the introduction of measures to combat the spread of the highly transmissible Omicron variant. Whilst the sector understands the priority must be to protect the population and NHS, Government must ensure measures are in place to support businesses – including automotive businesses – suffering from the effects of the pandemic, which for our sector, is most visible in the worldwide shortage of semiconductors.

With growing uncertainty over the coming weeks and months, SMMT will continue to keep members informed via the Covid-19 Automotive Business Support Hub, as well as keeping Government informed of the sector’s issues and performance, and seeking support measures where necessary.

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