EY UK & Ireland Automotive Leader, David Borland, Analyzes SMMT New Car Registration Figures for June 2024
The automotive industry in the UK is experiencing a period of remarkable growth, with new car registrations seeing a 23rd successive month of increase in June 2024. David Borland, EY UK & Ireland Automotive Leader, comments on the latest figures released by the Society of Motor Manufacturers and Traders (SMMT), highlighting both the achievements and challenges facing the sector.
Despite facing persistent headwinds such as cost-of-living challenges, evolving regulations, changing technology, and geopolitical uncertainty, the UK auto industry has shown resilience and achieved one million sales by the mid-year point. This consistent growth in new car registrations is a testament to the industry’s ability to adapt and thrive in a challenging environment.
Fleet sales have been a key driver of growth, with a 14.2% year-on-year increase, while demand from private retail consumers has seen a ninth consecutive fall. The shift towards Battery Electric Vehicles (BEVs) is evident, with a 7.4% year-on-year growth in June. However, there is still a long way to go to meet the Zero Emissions Vehicle (ZEV) Mandate target of 22% market share.
As OEMs work towards ZEV Mandate compliance, there is a need for careful consideration of future regulations and support for manufacturers and other stakeholders in the automotive ecosystem. The impact of these regulations extends across the value chain, requiring adaptation from suppliers, retailers, and fleet operators.
Looking ahead, the industry faces the challenge of selling 440,000 ZEVs to meet the ZEV Mandate compliance target, with only 167,000 sold in the first half of 2024. This presents a significant challenge that will require collaboration and innovation from all stakeholders in the automotive sector.
In conclusion, while the UK auto industry has shown resilience and growth in new car registrations, there are complex challenges ahead, particularly in meeting ZEV Mandate targets. By working together and adapting to a dynamic market, the industry can continue to thrive and lead the way in sustainable mobility.