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Fleet registrations rise but diesel demand still falling

The July car market saw a welcome rise in registration with both fleet and overall demand increasing, although year-to-date figures remain more downbeat.

Demand for hybrid and plug-in vehicles was up a fifth in July

Demand for hybrid and plug-in vehicles was up a fifth in July

Latest figures from the Society of Motor Manufacturers and Traders (SMMT) show a total of 163,898 new cars were registered last month – up 1.2%. Following June’s 7.0% decline, fleet registrations rose 2.6% to 91,542 units despite concerns over how WLTP issues are hitting new car demand. Within the sub-25 vehicle ‘business’ fleet sector, registrations were down 10.2% to 4,584 units while private registrations held steady at 67,772 – up 0.1%.

Diesel registrations continued their ongoing fall with a 24.4% in July as petrol demand grew 20.1%. Meanwhile, alternatively fuelled vehicles enjoyed an uplift of 21.0%, with market share of hybrids and plug-ins reaching a record 6.5%. Growth was particularly strong for plug-in hybrids, up by a third (33.5%), while hybrid registrations grew 17.5%, followed by battery electric cars, up 2.4%.

Year to date, the overall market remains down by 5.5%, broadly in line with expectations as demand begins to level out, according to the SMMT. Fleet registrations were down 6.0% to 769,152 units with ‘business’ registrations seeing a larger 11.4% fall to 53,764 and private registrations declining 4.4% to 654,976.

Commenting on the figures, Ashley Barnett, head of consultancy at Lex Autolease, said: “It’s positive to see a slight uplift in new car registrations, but more clarity is needed to maintain this momentum. Drivers are still reluctant to make significant purchase decisions while there is uncertainty in the marketplace, specifically around the future tax treatment of company cars.

“Businesses and consumers need to be able to make confident, informed choices, particularly if we are to meet the targets set out in the Government’s recent Road to Zero strategy. In order for 50% of new car sales to be ultra low emission by 2030, we will need to see an additional 100k new AFV registrations each year between now and then. We expect registrations of new AFVs to keep gathering pace in the coming months and are supporting customers with the switch to electric vehicles if suitable, but more needs to be done to increase their appeal and ease of use for drivers.”

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Natalie Middleton

Natalie has worked as a fleet journalist for 16 years, previously as assistant editor on the former Company Car magazine before joining Fleet World in 2006. Prior to this, she worked on a range of B2B titles, including Insurance Age and Insurance Day. As Business Editor, Natalie ensures the group websites and newsletters are updated with the latest news.