LONDON: New car sales in the UK hit an all-time high last month, with more than half a million vehicles registered and many buyers opting for diesel cars. Sales of new cars rose 8.4% from a year earlier to 562,337 in March, making it the biggest month since the Society of Motor Manufacturers & Traders started collecting data in 1976. This was more than double the number in the first two months of the year combined, and took registrations in the past three months up 6.2% to 820,016 – making it a new record quarter. Buyers seized the chance to buy cars before new vehicle excise duty rates came into force. From 1 April all new cars, apart from those with zero emissions, have to pay an annual flat rate charge. A record number of diesel cars – 244,263 – were sold in March. But there was also a 31% surge in sales of alternatively fuelled vehicles, to 22,818. Demand from fleets and businesses was particularly strong, with registrations up 12.6% and 11.9% respectively. Private buyers also splashed out on new cars, with sales up 4.4%, reversing the decline seen in the previous month.
The SMMT and analysts warned that demand was likely to slow in coming months, however. Howard Archer, the chief UK and European economist at IHS Markit, described it as “a last hurrah”. Both consumers and businesses are expected to pull back spending as job growth and the overall economy weaken, and higher inflation caused by the weak pound erodes households’ purchasing power. Mike Hawes, the SMMT chief executive, said: “These record figures are undoubtedly boosted by consumers and businesses reacting to new VED changes, pulling forward purchases into March, especially those ultra-low emission vehicles that will no longer benefit from a zero-rate fee. “This bumper performance probably means we will see a slowdown in April, exacerbated by the fact there are fewer selling days this year given Easter timing. Looking ahead to the rest of the year, we still expect the market to cool only slightly given broader political uncertainties as there are still attractive deals on offer.”
