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What’s Behind the 2017 Fall in New Car Registrations?

QMT Writer Latest, Motor Trade News 0 Comments

November is usually a month of peak sales, with Black Friday and Cyber Monday kicking people into action. That wasn’t the case, however, for new cars this year. Figures released by the Society of Motor Manufacturers and Traders (SMMT) revealed an 11.2% drop in new car registrations compared to the same month in 2016. Read on as we explore why car registrations are falling.

A closer look at the figures

So, what exactly does 11.2% represent? In units, it translates to over 20,000. Just 163,541 new vehicles were registered in November this year, compared to 184,101 in November 2016 – a drop of 20,560 to be precise. To put this into context, it marks the first drop in year-on-year November sales since 2011.

This fall was consistent across the board too, with a drop in new registrations private, fleet and business. New registrations for business were the worst hit, however, with 33.6% less compared to 14.4% for fleet and 5.1% for private vehicles. Things aren’t so simple when it comes to fuel though. While registrations of diesel cars dropped by a massive 30.6%, new petrol car registrations actually went up by 5%, with an impressive 33.1% rise for alternatively fuelled vehicles (AFVs).

Not just November

For those keen on tracking the automotive industry, this drop in sales will be no surprise. In fact, this is the eight-consecutive month of decline for new car registrations. Up to and including November, 2017 has seen a 5% fall compared to the previous year.

Why? According to SMMT Chief Executive, Mike Hawes, it’s down to the confusion around diesel. “An eighth month of decline in the new car market is a major concern, with falling business and consumer confidence exacerbated by ongoing anti-diesel messages from government,” he said.

Anti-diesel government

The government announced a crackdown on diesel as part of its Clean Air Strategy in July 2017. The Chancellor’s Autumn Budget reinforced this crackdown, with plans for higher taxes on diesel vehicles. The problem? These taxes don’t distinguish between new, low-emissions diesel cars and old high-polluting vehicles. Hawes suggests that their plans will only lead to worsening emissions – as well as causing car registrations to fall.

“Diesel remains the right choice for many drivers, not least because of its fuel economy and lower CO2 emissions. The decision to tax the latest low emission diesels is a step backwards and will only discourage drivers from trading in their older, more polluting cars. Given fleet renewal is the fastest way to improve air quality, penalising the latest, cleanest diesels is counterproductive and will have detrimental environmental and economic consequences”

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