New car sales in the UK plummeted 20% in April, largely due to the rise in Vehicle Excise Duty (VED) rates, according to industry body the Society of Motor Manufacturers & Traders (SMMT).
Registrations fell by 19.8% to 152,076 in April, compared with 189,505 cars sold in April 2016.
It was also the first month in 47 in which there was a downturn in demand for alternatively-fuelled vehicles (AFVs) which is also attributed to the higher VED rates affecting hybrid models.
Private buyers and business demand were also down, falling by 28.4% and 21% respectively. Meanwhile, petrol demand dropped by 13.1%, but the most notable drop was diesel which fell by 27.3%. However, despite sales falling, the market share for diesel rose versus April. In March, diesel accounted for 43.4% of sales and in April, 44.9%.
Overall, the market is up 1.1% year-to-date with a record 972,092 cars registered in the first four months.
The news comes after a bumper March for car sales, thanks to the number plate change and the public’s desire to avoid the VED rises that came into force on 1 April.
SMMT chief executive Mike Hawes said: “With the rush to register new cars and avoid VED tax rises before the end of March, as well as fewer selling days due to the later Easter, April was always going to be much slower.
"It’s important to note that the market remains at record levels as customers still see many benefits in purchasing a new car. We, therefore, expect demand to stabilise over the year as the turbulence created by these tax changes decreases.”
Talking about the tax rises, Hawes told Autocar: "We never like regulatory changes, but they do come from time to time. They always disrupt the market and present business with some challenges."