October 21, 2021New Car Registrations At An All Time Low
Industry figures show that new car registrations have fallen to the lowest level in more than two decades.
According to the Society of Motor Manufacturers and Traders, new registrations of vehicles have fallen by 35% compared with the same month in 2020. Usually, September is a popular month when it comes to car sales, as it is at this time of the year that the bi-annual change in number plates occurs – attracting new buyers.
Despite this, only 214,000 cars were sold in September 2021, the lowest amount since the start of the country’s current registration system 23 years ago.
Car sales fall to lowest level in two decades
As well as September’s slump in new registrations, 2020 was also a fallow year for car sales. 1.63 million cars were registered during the year, a fall of 29% – the biggest one year fall since World War Two.
Despite the overall downward trend, electric car sales have actually seen a rise of 40% in the same period, suggesting that consumers are becoming increasingly more conscious about their impact on the environment.
As new registrations have fallen, the demand for second-hand vehicles has also soared, with more than two million vehicles sold in the year’s second quarter.
Why are new car registrations down?
So, what are the reasons behind the decrease in new car registrations?
Well, it all comes down to a global shortage of computer chips. The semiconductor computer chips are incredibly important in the automotive industry as they play a fundamental part in many innovations in modern-day car manufacturing.
Without these chips, the manufacturing process can not be completed, which is resulting in backlogs and therefore a lack of new registrations being processed. Semiconductor chips are also commonplace in a whole host of household objects such as laptops, washing machines and hairdryers, so these shortages may become evident on our shopping shelves, too.
The main reason for the worldwide shortage is down to supply chain issues as a result of the COVID-19 pandemic. This has meant that the manufacturing plants, particularly in Asia, are struggling to get hold of the chips, having a knock-on effect on the entire industry.
This, coupled with the uncertainty surrounding Brexit, is the main reason for such a significant fall in new car sales.
While the UK, like many other countries, has undoubtedly been hit hard by the shortages that have led to low registrations and sales, as previously mentioned the good news is that electric car sales have seen a boost.
If the UK is to meet its ambitious climate targets, half of all cars on the road need to be electric by 2030, so it’s vital that this consumer habit continues. The British government is already beginning to phase out petrol and diesel vehicles, with a ban on the sale of new ones coming into force at the end of the decade, but there’s still a way to go.
It’s hard to predict exactly where industry trends will go, but many forecasters think that more and more of us will opt for electric cars as we head towards a greener future. If this is the case, then it’s likely that battery production will need to be increased in this country.
That’s because new rules from 2027 mean that only car batteries made in the UK or the EU will be accepted as limits are imposed on components coming from out of these two regions. And with the UK’s less than harmonious relationship with the Union, it’s safe to say that developing them here may be the best idea.
Here at Treadfirst, whether you’re driving a new or second-hand car, or an electric vehicle, we’re here to help. With branches across East Anglia, our team provides our customers with a whole host of great services including tyre-fitting, wheel alignment and general servicing and repairs. You can even book an MOT online to make sure your car is safe and roadworthy. To find out more, get in touch with Treadfirst today.