Analysis of the UK new-car market in May 2024: A delicate balance between growth and decline

The UK’s new-car market has been on a steady growth trajectory for the past 22 months, but recent data suggests that this trend may be facing some challenges. In May, new-car registrations increased by 1.7% year on year, with fleet registrations driving the growth. However, private registrations declined, indicating a shift in the market dynamics.

One of the key indicators of the changing market landscape is the decline in internal-combustion engine (ICE) registrations. Both petrol and diesel registrations saw a decrease in May, with petrol’s market share dropping to its lowest point of the year. This decline in traditional combustion engines is being offset by the increasing popularity of electrified powertrains, including full hybrids, battery-electric vehicles (BEVs), and plug-in hybrids (PHEVs).

BEVs, in particular, have continued to gain traction in the UK market, with a 6.2% growth in registrations in May. Despite concerns about a slowdown in the BEV market, the technology’s market share has actually increased, reaching 17.6% in May. This trend is reflective of the overall shift towards more sustainable and zero-emission vehicles in the market.

Hybrids, both HEVs and PHEVs, also saw growth in registrations in May, outperforming the ICE market. PHEVs, in particular, have seen a significant increase in market share, indicating a shift towards more electrified models in the market.

Overall, the data from May suggests that the UK’s new-car market is at a crossroads, with traditional combustion engines facing decline and electrified powertrains gaining momentum. As fleet registrations increase and companies strive to meet green targets, the market is likely to see a continued shift towards more sustainable and zero-emission vehicles. This shift presents both challenges and opportunities for the automotive sector in the UK, as it navigates the changing landscape of the industry.