2021 off to bad start for UK car dealers as lockdown cuts demand

New car sales were down almost 40 percent in January as lockdown ensured a slow start to 2021 for the UK automotive industry. With showrooms effectively closed and dealers limited to click-and-collect trading, figures from the Society of Motor Manufacturers and Traders (SMMT) showed registrations were down 39.5 percent compared with January 2020.

In total, just over 90,000 new cars were registered last month, down from almost 150,000 in January 2020. It’s a result that has caused the SMMT, which represents the UK’s car dealers and makers, to call for showrooms to open as quickly as possible in a bid to support the industry.

“Following a £20.4 billion loss of revenue last year, the auto industry faces a difficult start to 2021,” said SMMT chief executive Mike Hawes. “The necessary lockdown will challenge society, the economy and our industry’s ability to move quickly towards our ambitious environmental goals. Lifting the shutters will secure jobs, stimulate the essential demand that supports our manufacturing, and will enable us to forge ahead on the road to zero [emissions]. Every day that showrooms can safely open will matter, especially with the critical month of March looming.”

As expected, petrol and diesel car sales bore the brunt of the drop in demand, with sales down 50 and 62 percent respectively. Nevertheless, those vehicles still make up the bulk of new car sales, with petrol accounting for almost exactly half the market. Diesel, meanwhile, makes up around 12 percent of all new car sales.

In a month such as January, the only success stories are to be found among the “alternatively fuelled” vehicles – the electric and hybrid cars. The seemingly inexorable surge in electric vehicle (EV) sales continued into 2021, with more than 6,000 new EVs hitting UK roads last month. That’s up from around 4,000 in January 2020.

Plug-in hybrid sales were up, too, with around 6,000 vehicles registered. That’s a 28 percent uplift on the first month of 2020, when 4,786 such vehicles were sold. But conventional hybrids were less of a hit, with 6,826 new vehicles registered in January. That’s a 24-percent reduction on the same month in 2020.

With that, these alternatively fuelled vehicles now account for roughly equal shares of the market. With sales of between 6,000 and 7,000 for each of the aforementioned vehicle types, EVs, plug-in hybrids and conventional hybrids now each account for around seven percent of new car sales.

See which cars were the most popular in 2020:

The UK's best-selling cars of 2020

The closure of dealerships affected some manufacturers more than others, though, with Ford seemingly hit hard. The Fiesta was yet again the UK’s most popular car last year, but the little hatchback could only manage fourth place in January. And the larger Focus, which was the UK’s fourth most popular model last year, could only manage 10th spot in January.

But where Ford missed out, other manufacturers thrived. The Vauxhall Corsa, which came second in 2020, usurped the Fiesta at the top of the tree, while the Kia Sportage – a car that didn’t even make the top 10 in 2020 – grabbed second place.