Auto sales in 2020 fell by almost a third to a 28-year low due to the Covid pandemic. This is confirmed today by dramatic new figures from automobile manufacturers.
With dealerships and their showrooms closed for two extended periods of time during the year due to the killer virus, sales to UK customers fell to just 1.63 million – the lowest since 1992 – although electric car sales rose sharply.
Figures released on Wednesday morning confirmed a year-over-year decline in new car sales of 29.4 percent from 2.31 million vehicles purchased in the UK in 2019.
The decline is the most significant since the height of World War II in 1943, when civil car production stopped when factories switched to military production.
Trade bosses called 2020 a “lost year for the automotive industry” that cost the UK auto industry £ 20 billion and resulted in a tax loss of £ 1.9 billion for the Treasury Department.
Sales crash: new registrations fell to a 28-year low in 2020 as the pandemic restricted the number of engines sold by dealers
The 1.6 million new cars registered in the UK in 2020 are the lowest since 1992, it has been confirmed
A total of 1,631,064 new engines were registered in 2020, according to official data today.
While sales of electric cars almost tripled from their relatively low level in the face of the pandemic, diesel registrations halved.
With the fate of electric vehicles and oil burners in opposite directions, this means that all-electric and plug-in hybrids now make up one in ten passenger cars bought in the UK.
However, automakers warn that a lack of investment in on-street charging points for motorists – especially with no driveways and off-street parking – could undermine the government’s ambitions to achieve its goal of selling gasoline and diesel cars by 2030 to end.
With the deadline only nine years away, the heads of the trade organizations said it was “a major challenge to get from 10 percent to 100 percent of electricity sales in such a tight time frame”.
Mike Hawes, Chairman of the Board of Directors of the Society of Motor Manufacturers and Traders, said: “2020 is viewed as a ‘lost year’ for the automotive industry as the sector is pandemic for much of the year and uncertainty about future trading conditions.” their toll.
‘However, with the introduction of vaccines and the clarity of our new relationship with the EU, we need to make 2021 a year of recovery.
“As manufacturers bring record numbers of electric vehicles to market in the coming months, we will work with the government to encourage drivers to make the switch while encouraging investment in our world-renowned manufacturing base – market, industry and economy again charge.”
The dealers were allowed to reopen their showrooms on June 1, 2020 – albeit with strict Covid measures – after they were forced to close from the end of March
The manufacturers had hoped to reach annual registrations of around 2 million again in 2021.
However, the government’s recent announcement of a third national lockdown will almost certainly spoil optimism as dealers will be instructed to re-latch their showroom doors.
With restrictions meant to last through at least mid-February, there is a very real risk that the final lockdown will be extended into March, which is one of the most important months for cars if the infection rate doesn’t flatten out dealerships.
March is historically the second largest month for vehicle sales after September. New registration numbers will be introduced during these two months.
Dealers in England had to close their doors in 2020 with two national lockdowns
A 29.4% drop in car registrations in 2020 is the biggest year-over-year drop in the UK since car factories closed in WWII to focus on military manufacturing
However, there is optimism in the industry.
The fact that merchants can now offer remote click-and-collect services to their customers means that some of the effects of locked showrooms can be mitigated.
Commenting on the SMMT numbers, Jim Holder, editor-in-chief at What Car ?, “With the recent lockdown announcement, the industry is facing tougher months, but lessons from a difficult 2020 ensure that it will be better able to address the challenges by 2021 is prepared it is now facing.
“This should keep sales from falling off the cliff, as we saw with the first lockdown in March.”
He added: “From March last year it was clear that 2020 would not be a good year for the UK auto industry.
“With retailers being forced to close their doors for nearly three months between March and June and the restrictions being different for the rest of the year, the challenges were immense.”
Merchants can make click-and-collect sales during the suspension. This means that buyers cannot enter a showroom but can get the keys to their new engine from the dealer outside
Sue Robinson, executive director of the National Franchised Dealers Association, said the drop in sales was “not surprising”.
“It is encouraging that the electric vehicle market continued to grow despite the problems affecting the auto industry and the economy, both fueling consumer appetites and rewarding dealers’ efforts to meet demand,” she said in a statement Wednesday morning .
“Although physical showrooms will have to remain closed for the coming weeks, franchisees have demonstrated their adaptability, providing click-and-collect services to customers in a secure and compliant manner. This cannot completely replace the traditional buying experience, but it will make up for some of the problems businesses face in the months to come. ‘
Auto bosses said reaching a Brexit trade deal with the European Union was also a “massive relief,” but warned that there were still some hurdles, including additional red tape to reduce the cost of exporting, importing and selling Cars could increase.
Mike Hawes, CEO of SMMT, said, “The no-deal cliff has been graciously averted. But there are still challenges ahead of us. ‘
Experts say car dealers are now better prepared to operate during the pandemic and lockdowns, and click-and-collect services can run at full speed
December registrations at a glance
The year was rounded off with a year-on-year decline in sales of 11 percent in December, which includes “a turbulent 12 months,” said the SMMT.
132,628 new engines were registered in the last month of last year, up from 148,997 in December 2019.
Commenting on last month’s numbers, Karen Johnson, Head of Retail and Wholesale at Barclays Corporate Banking, said: ‘December vehicle registrations reflected a very tumultuous 2020, with the month showing signs of continued consumer interest in used and electronic equipment showed vehicles.
‘It has been reported that a number of manufacturers pushed car registrations in December to break the Brexit transition period, while some consumers may also have chosen to buy before that deadline to guarantee prices a’ no deal”.
“However, neither was enough to prevent a decline in new registrations compared to the same month last year, 2019.”
The Tesla Model 3 was the top-selling model in December
The best-selling model of the month was the Tesla Model 3, which was the best-selling passenger car at the beginning of the year when the first lockdown hit the sector in April and May.
Another notable inclusion in the bestseller was the Volkswagen ID.3 – the German brand’s first purpose-built electric car. Around 3,188 vehicles were registered in December. This makes it the fourth most popular car of the month ahead of volume models like the Vauxhall Corsa and the Nissan Qashqai.
The switch to electric cars has undoubtedly started in 2020
Sales of battery-electric vehicles tripled from around 37,800 in the previous year to 108,000 in 2020 – an increase of 186 percent.
Compared to the overall decline in car sales, the share of all-electric cars in the UK market quadrupled to 6.6 percent after just 1.6 percent in 2019.
Sales of plug-in hybrids or PHEVs almost doubled from around 35,000 to 67,000, with the market share increasing from 1.5 percent to 4.1 percent.
Taken together, this means that plug-in cars account for more than 1 in 10 sales.
As diesel sales fell, battery electric vehicle registrations had a record year. Demand rose 186% and market share rose to over 6%
In contrast, diesel sales halved to 322,000 from 620,000 in 2019.
They only make up one in five new registrations (20 percent) compared to 28 percent in 2019.
It is far from the pre-“thislgate” scandal when they made up half of the cars sold in the UK.
Diesel was last lower in absolute volume in 2000, when sales were 313,192, and the volume share in 2001 was 17.8 percent.
Gasoline vehicle sales also fell, but only by around a third to just over 1 million from 1.52 million in 2019.
Their market share fell from 68 percent in the last 12 months to 63 percent.
One in ten new cars purchased in 2020 were plug-in models, either battery-electric vehicles or plug-in hybrids
The move towards electrification will accelerate further this year as the British prepare for Boris Johnson’s proposed plan to ban sales of new internal combustion engine cars from the beginning of the next decade.
In 2021 alone, 29 new all-electric cars and seven new plug-in hybrids of which the SMMT is aware are to be brought onto the market.
This is comparable to 28 vehicles with a traditional and soon to be banned gasoline or diesel internal combustion engine.
“The government must invest billions in infrastructure to meet the electric vehicle target for 2030.”
But the SMMT says its “possible” government could miss its target of 100 percent of new car sales by 2030 being electric or plug-in hybrids in just nine years.
The lack of sufficient charging points is the key brake on reaching the destination.
The government needs to invest around £ 16 billion to ensure that there are adequate charging points for such drivers.
Mike Hawes, CEO of SMMT, said, “What is stopping people from buying an electric car is not fear of range, but lack of charging points, especially for those who don’t have their own garage or driveway.”
2020 is seen as a “lost year” for the automotive industry as the sector is hit by a pandemic for much of the year and uncertainty about future trade conditions takes its toll
Mike Hawes, CEO of SMMT
That makes up around half of all motorists, he said.
“You need to know that you can park your car and charge it on the street overnight – even if you live in a row house and have to park outside your own home.”
Mr. Hawes remarked, “Missing the mark is one possibility. The production of electric vehicles must increase tenfold. ‘
He also raised concerns that electric cars built on the continent could have priority for EU countries, which will be delayed if the British can get their hands on the latest plug-in vehicles.
“There are penalties for the UK and the EU for not setting carbon targets.”
The UK also needs much more battery capacity for UK-built electric cars to avoid tariffs being paid for violating the tightened UK-EU trade rules on local content in cars.
Electric batteries are at the heart of electric cars and UK built batteries require UK made batteries. And that means more battery production facilities than the ones Britishvolt announced last month being built in the northeast.
According to SMMT, based on current investment intentions, the UK should have a gigafactory capacity of 15 GWh by 2024, which is enough to produce 250,000 all-electric cars per year.
To produce 1 million locally by 2030, the UK will need four times that capacity – around 60 GWh per year.
By 2040, this value has to double again to 120 GWh by 2040, as does a surrounding supply chain for batteries and chemicals to support the production of 2 million BEVs.
In contrast, the EU – now a rival – is projected to reach almost 450 GWh per year of capacity by 2030 and 1.2 TWh per year of capacity by 2040.
Perhaps a tempting fate, concluded Mr. Hawes, “Whatever happens, this year can’t be as bad as last year. Manufacturers and dealers are better prepared. We expect a little more security. And it’s a good time to buy a new car. ‘
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