Auto Trader's commercial director, Ian Plummer, offers his response to the latest new car registration figures.
Ian Plummer, Commercial Director, Auto Trader:
“September marked the strongest single month of new car sales since September last year, which given the current climate is a notable achievement. And whilst there may be some doomsayers pointing to the year-on-year drop, the data points to a different interpretation; based on retailer and brand reports of sales rates during September, the market was in fact tracking up on last year right up until the last day of the month. At that point the usual “push” of closing actions that in recent times would weigh more than one in four sales of the entire month was far less aggressive than normal, leaving the final full month numbers slightly below last year. From many different perspectives, that’s far from a bad thing.
"There have been a number of key factors at play, not least significant stock issues. Whilst consumer demand has been robust, as manufacturers build up to full productivity post lock-down, car retailers haven’t always had the full new car supply required to meet it. Where pockets of supply do still exist, after months of selling through existing stock, they're typically the less in demand cars. What’s more, having often achieved their quarterly targets naturally, retailers haven’t had the appetite nor the means to secure additional registrations at the very close of the month.
“With many retailers and manufacturers hitting their respective targets for the third quarter, it’s allowed the industry to take some of the usual excess heat out of the market. This is a good sign for the month ahead since it will both avoid negative impacts on used car values in a healthy state as well as avoid any knock on effects on Q4 new car sales rates.
“It’s important to note, that the 4.4% decline is not a reflection of decreasing consumer demand for new cars, which in fact remains at record levels. We had 61.6 million cross platform visits in September, up 23.5% on last year. And there were 150% brand new car leads sent to retailers across the month compared to the same time last year. Based on our consumer metrics and research, we don’t seen any indication of that demand slowing anytime soon.
“The market share of electric vehicle sales is almost double where we were a year ago which is a positive sign. Sales of new electric vehicles are likely to have been bolstered by the new models which have been launched this year, giving consumers more options to choose from. The challenge is, however, whether we can double each year beyond this one as we work towards the government’s ambitious plan to ban the sale of new petrol and diesel cars by 2030. To truly accelerate the sale of green cars, the government needs to introduce compelling incentives to bridge the current price gap that’s still holding back the majority of car buyers, otherwise the target is simply unattainable.”