The UK’s post-pandemic recovery for the new car market suffered a setback in July, according to the latest figures from the Society of Motor Manufacturers and Traders (SMMT), attributed to supply chain shortages and frustrations caused by the ‘pingdemic.’
A total of 123,296 new cars were registered in July. That represents a 29.5% drop on the same period in 2020, when registrations rose dramatically as showrooms opened for the first full month of operation following the original lockdown.
Performance in July was down 22.3% compared with the decade average, said the SMMT, which claims the semiconductor shortage and ‘pingdemic’ (staff shortages arising from the government's Covid contact tracing scheme) have impacted supply and demand.
The registration figure means July 2021 was the weakest July for car registrations since 1998, prior to the introduction of the current two-plate registration system. The decline was primarily within large fleets, where registrations were 28.7% lower than the average recorded over the past decade. It is expected that growth will continue to slow into August, a quiet month for car registrations over recent years.
Registrations of plug-in vehicles continued to grow and battery-electric vehicles (BEVs) contributed to 9.0% of overall registrations with 11,139 units, while plug-in hybrids (PHEVs) accounted for 8.0% with 9900 units. The SMMT predicts BEV uptake will rise, making up 9.5% of all registrations by the end of 2021.
“The automotive sector continues to battle against shortages of semiconductors and staff, which is throttling our ability to translate a strengthening economic outlook into a full recovery,” SMMT chief executive Mike Hawes said.
“The next few weeks will see changes to self-isolation policies which will hopefully help those companies across the industry dealing with staff absences, but the semiconductor shortage is likely to remain an issue until at least the rest of the year.
“As a result, we have downgraded the market outlook slightly for 2021. The bright spot, however, remains the increasing demand for electrified vehicles as consumers respond in ever greater numbers to these new technologies, driven by increased product choice, fiscal and financial incentives and an enjoyable driving experience.”