Hope for car showrooms across the UK despite uncertainty
The current economic and political climate has had a serious impact on the automotive industry in 2017, most notably by a drastic fall in new car sales. New car registrations fell by 9.3% this September compared to last, with the market falling for the last six months in a row. The September figures have caused considerable concern as it is usually a huge month for new car sales due to the change in license plate series.
Air of Uncertainty
The main reasons for this free fall in new car sales are the uncertainty surrounding Brexit and the economic situation, which has halted consumers from making large financial decisions. In addition to this, the Government’s plans to scrap the sale of diesel and petrol cars by 2040 has caused concern. This is despite the fact that there is a great deal of uncertainty as to whether or not this is achievable.
With so much uncertainty in the air, it is understandable that consumers are not cur-rently looking to buy new cars. Whilst this is bad news for many, things are slightly more positive in used car showrooms around the country.
Used Car Sales on the Rise
Used car sales have been on the rise in 2017 according to the top car dealers North-ampton and other areas of the country has. March was a key month where 728,525 used cars were sold. This was up 6% compared to March 2016 and just the second time since 2004 that 700,000+ used cars changed ownership. Additionally, there has been a rise in the sale of electric and hybrid automobiles which suggests that the pub-lic is preparing for the 2040 ban.
This shows that consumers are reluctant to make large financial decisions (such as buying a new car) at the moment, but there is still demand for more affordable used automobiles. The big question now is “what does the future hold?”.
What Next?
Society of Motor Manufacturers and Traders (SMMT) chief executive Mike Hawes claims the “government must act quickly to provide concrete plans regarding Brexit. While it's encouraging to see record achievements for alternatively fueled vehicles, consumers considering other fuel types will have undoubtedly been affected by the uncertainty surrounding the government's clean air plans.”
Until there is more certainty surrounding Brexit and the clean air plans, it is easy to see consumers continuing to hold off buying a new car (unless it is a hybrid or elec-tric). For used car dealers, they could soon begin to see more and more consumers looking to trade in their current automobiles and pick up an environmentally friendly vehicle. In addition to preparing for the 2040 ban, this would also see motorists bene-fit from the Government’s incentives, which include a grant for eco-friendly cars and zero road tax for all-electric automobiles.
Brexit Talks
Exit talks remain deadlocked in Brussels for the time being, but this will not continue and soon there will be a much clearer idea of what the future looks like for the UK. What this means for new car sales remains to be seen, but used car dealers are confi-dent that they will continue to see the growth of sales into 2018 and beyond. The used car market is currently much lower risk and especially when you are able to sell your current car or use it as part of a part-exchange.
Whilst it may be all doom and gloom for new car sales in the UK due to the economic and political climate, the sale of used cars continues to grow as motorists look to make much smaller financial decisions. There could also be a huge boost in new and used sales if the Government’s clean air plans are to go ahead for 2040.
