The latest new car registration data shows that for the month of July 2018 the new car market has performed mildly better than the same month last year with an increase in volume of 1.2%. This is interesting given the time of year and specifically because general market feedback is that trading conditions have been difficult given both the weather and general economic concerns. This means that the market as a whole is down 5.5% year to date which is perhaps less than the industry expected, although the latter part of 2018 looks to be somewhat difficult from a demand and trading perspective. This will not have been helped by the increase in the Bank of England base rate either.
The diesel market has continued to suffer registration drops with a fall of 24.4% over the same period last year. Despite commitment to the fuel type from both the government and key manufacturers, consumers, whether fleet or private buyers are still driven to petrol and hybrid vehicles for the time being. The diesel market share for 2018 is down 11.2% year to date and rests at just 32.5% which is a level that few industry experts would have foreseen just a couple of years ago. This lower level of market penetration seems to have stabilised for the time being which is positive news for those planning future vehicle production and seeking to forecast future vehicle values.
For petrol powered cars the market has seen an increase in registrations of 20.1% over the same period last year and market share for the year to date is a substantial 61.8%. Hybrid vehicle registrations have shown a lower improvement in volume than experienced in recent months at a still healthy 21% for the month, taking market share for the year to 5.7%. The volume of petrol cars being registered this year is likely to become an issue in future years as vehicles return to the used car market. Equally, there is wide speculation that pollution from petrol cars will increase notably and the industry is moving the issue from one fuel type to another.
Generally speaking, the July new car market has been a stable month when looking at registration data with a balance of buyers from both the private and fleet markets. There is no doubt there is some pent-up demand in the fleet sector due to the impending WLTP changes, and the August registration data will be very interesting. Equally, the industry must be cognisant of the fact that “registrations” are not actually “sales” and the coming months are likely to be heavily influenced by commercial considerations and strategy in part brought on by legislative changes.
The used car market data collated by Cazana from live retail pricing has shown some interesting trends during 2018. With the industry-driven so heavily by the consumer these days, retail-driven insight has become ever more important. The next chart gives a high-level view of overall market performance at three key market profiles.