June’s new LCV registration figures published by SMMT offer some welcome relief for the UK’s van market. Registrations rose by 12.2% to 31,602 units, marking a third consecutive month of growth and helping push the year-to-June market 1.7% ahead of the same period last year.
Against a backdrop of lower volumes and market disruption over the last 18 months, returning to growth is encouraging. The headline suggests a market regaining momentum and there are indeed reasons to be confident, with demand driven overwhelmingly by larger vans. Registrations of vehicles between 2.5 – 3.5 tonnes rose by 12.6%, while the medium van segment surged by more than 60%, with businesses continuing to invest despite an uncertain economic backdrop.
Not every part of the market is sharing in that recovery, however. Smaller vans lost ground declining by just shy of 20%, and nowhere is the divergence more striking than in the pickup sector. Registrations collapsed by almost 58% compared with June last year – a decline which follows government’s decision to reclassify double-cab pickups for Benefit in Kind and capital allowance purposes, fundamentally changing the economics for many fleet operators.
The electric van market presents a similarly mixed picture. Battery electric van registrations rose by more than 23% in June, extending a positive run of growth and lifting first-half market share to 9.9%. It is genuine progress and reflects the growing availability of electric models across the market thanks to significant manufacturer investment.
Demand, however, remains well below the 24% share mandated this year – a target that would require uptake to average some 40% market share, four times its current level, over the next six months. Such growth under the current market conditions is simply unachievable.
The industry’s challenge is no longer one of product availability but market readiness. Maintaining momentum towards decarbonisation, without undermining business investment or UK competitiveness, requires a regulatory framework that better reflects commercial reality. Ambitious targets have an important role to play, but ambition alone cannot overcome practical barriers faced by the businesses expected to deliver the transition.
June’s figures demonstrate that the van market remains resilient. Questions remain, however, over when government will carry out its review of the regulation and take a realistic approach that van operators – and therefore the market – can actually achieve. SMMT will continue to call for a timely review that gives much-needed certainty to industry sooner rather than later.
