UK new car market drops for the first time in six years to 2.54 million

New car registrations have tumbled by 5.6 per cent in 2017 – the first time the UK automotive industry has seen this in six years.

The number of cars registered reached only 2.54m last year, with the Society of Motor Manufacturers and Traders revealing the full year figure today.

Figures were even worse than expected when the SMMT announced it had revised its estimates for the next three years. Predictions then were that the 2017 new car market would reach 2.565m, down only 4.7 per cent.

Over the past nine months car sales have been down and December was no different. The month was down 14.4 per cent to around 152,000 cars, making the last quarter of the year down by 12.4 per cent.

SMMT chief executive Mike Hawes said: “It’s important to put this into context – this is about the sixth biggest year ever and third best in the last decade, coming off a record 2015 and 2016, so the market is still a record high. The decline is definitely cause for concern, though.”

Diesel took the biggest hit of the year, with demand down by 17 per cent. Although alternatively fuelled vehicles (AFVs) were up by 37 per cent, their market share remains low at 4.7 per cent (3.3 per cent in 2016) of the 2,540,617 cars sold.

Of the 119,000 AFVs registered, 71,000 are hybrids, 33,000 are plug-in hybrids and 13,500 full electric.

Alex Buttle, director of car buying comparison website Motorway.co.uk, said: “Quite frankly, 2017 has been a year to forget for the UK car industry.

“You’d have to dig pretty deep to find anything positive to take from the past 12 months which has seen diesel demonised in the media on a weekly basis.

“As sales of new diesels continue to fall, 2017 could well mark the end of one era of motoring and the dawn of a new one, as hybrid and electric sales start to take off.

“The destiny of diesel may already be set in stone. Now the Government needs to stand by its commitment to the future and put its full backing behind AFVs.”

A spokesman for The AA noted that the demonisation of diesel is actually resulting in less efficient cars being on the road.

He said: “A drop of about 200,000 diesel vehicles over the year is a massive dip.

“When you look at fuel consumption figures, new diesel cars in 2014 had an average economy of 59.9mpg and in 2016, which is the most recent data available, it was 62.2mpg.

“That’s almost a four per cent improvement in diesel economy over two years, so that means that if fewer diesels are being sold and people are holding on to old cars, you’re not getting the more fuel efficient cars coming into the market.”

By Becca Chaplin