Car sales slump to 20-year September low despite new reg plates

Registration plate update in September normally drives demand but motorists are shunning big purchases

Sales of new cars in the normal boom month of September have fallen to their lowest level in more than 20 years as coronavirus continues to ravage the automotive sector.

Registrations of new vehicles fell by 4.4pc compared with the same period a year ago, with the keys for 328,041 cars handed over.

Demand in September is normally boosted by it being one of the two months when registration plates update.

However, worries about the health of the economy and employment fears caused by the pandemic, along with continued concerns about Brexit’s likely impact, meant sales for new 70-plate cars flopped.

The figures were the lowest since the introduction of the dual number plate system in 1999. Drilling down into the data revealed an even worse performance than the headline number indicated.

According to the Society of Motor Manufacturers and Traders (SMMT), September’s registrations were flattered by weak performances in the preceding two years.

The trade body said that demand represented a 15.8pc drop on the 10-year average for the month.

Overall sales in the first nine months of the year are now down by a third on 2019's levels.

Mike Hawes, SMMT chief executive, said: “During a torrid year, the automotive industry has demonstrated incredible resilience, but this is not a recovery. Despite the boost of a new registration plate, new model introductions and attractive offers, this is still the poorest September since the two-plate system was introduced in 1999.

“Unless the pandemic is controlled and economy-wide consumer and business confidence rebuilt, the short-term future looks very challenging indeed.”

However, the decline is not entirely down to motorists reining in their spending, according to trade group the National Franchised Dealers Association.

It said that dealers had experienced “strong” demand with “high levels of enquiries”, but supply problems had held back a number of manufacturers so they had been unable to get cars to buyers.

Sales of cars to private motorists, which represent roughly half of the total, were down 1.1pc in the month, while those to fleet buyers such as hire firms were 5.8pc lower. 

So-called “alternative fuel vehicles” such as electric and hybrid cars continued to grow in popularity, making up just under a third of all registrations during September, up from just over a 10th a year ago.

The sales fall came as Jaguar Land Rover, Britain’s biggest car maker, reported that demand for its vehicles continued to decline.

In the three months to the end of September the company reported worldwide retail sales of 113,569 cars, down 11.9pc on the same period in 2019.

However, it was a significant improvement on the preceding quarter, when the company sold just 74,067 cars as the pandemic shut factories and dealerships.

Out of JLR’s four manufacturing facilities in the UK, the vehicle plants at Solihull and Halewood, along with the engine factory at Wolverhampton, are now back to a two-shift working pattern, thought Castle Bromwich remains at low-rate production.

The key Chinese market reported sales 14.6pc up on the previous quarter, though this was outperformed by the UK, which grew by 231pc, Europe, 79pc stronger, and North America, 21pc better.