Published: Sat, January 06, 2018
Markets | By Rosalie Gross

New auto sales suffer biggest decline since 2009

New auto sales suffer biggest decline since 2009

Diesel sales have fallen by 17.1% "as higher taxes and pollution fears hit demand".

Mike Hawes, the chief executive of SMMT, said that 2017 had been a "very volatile year" and further warned that the vehicle market could weaken more this year.

While overall UK new vehicle registrations fell by 5.7% in 2017, MG Motor UK experienced percentage growth in every month of the year.

It said approximately 2.54 million new cars were registered in 2017 compared with 2.69 million the previous year - with diesel sales continuing to provide the main drag. More than 2.5 million people drove away in a new auto a year ago, benefitting from the latest, safest, cleanest and most fuel efficient technology. "The cost of regulatory compliance has led manufacturers to consider the financial viability of producing diesel cars below €35,000, while consumers are considering the merits of buying diesel at a time when Governments are introducing bans that prevent them from driving those cars into their capital cities".

The SMMT admitted it was not all doom and gloom as 2017's figures still represented the third best year for new auto registrations in the past decade.

However, Ford remained at the top of the table for sales but dropped by 9.7 percent in registration.

Diesel protestor
VW's admission it cheated pollution tests on its diesel-powered cars sparked international protests Credit DPA

The electric auto sector, though still small in comparison, took an encouraging leap over 2017, expanding to 120,000 registrations, a 34 per cent lift.

Meanwhile, German automaker, Mercedes-Benz also saw new vehicle registrations increase by 6.6 percent in 2017, from 169,828 to 180,970.

The market share for petrol cars increased from 49% in 2016 to 53.3%, and AFVs were up from 3.3% to 4.7%, while diesel declined from 47.7% to 42%.

According to SMMT, despite the decline in auto registrations, vehicle demand remained highest at 2017 in a decade. With that 17 per cent fall in United Kingdom diesel sales, there are going to be forecourts the length of our nearest neighbour clogged with unsold diesel cars, all of them falling in value, all of them just begging to be flogged off cheap here. The decline is definitely cause for concern, though, ' Hawes said.

"Diesel cars, due to their greater fuel efficiency, typically emit on average 20% less Carbon dioxide than the equivalent performance of a petrol-engined vehicle".

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