Record high for UK new car market

The UK new car market hit an all-time high in 2016, with annual registrations climbing for the fifth year in a row to almost 2.7 million.

Figures released by SMMT found that the market experienced an uplifts in 10 out of the last 12 months, although December tapered off slightly with a fall of 1.1% as 178,022 new cars were registered in the month.

The wide range of models (nearly 400) coupled with attractive finance deals pushed registrations up to 2,692,786 last year, a 2.3% increase on 2015.

Fleets were responsible for most of the growth, with demand growing to a record 1.38 million units, while the private market remains at a historic high with more than 1.2 million private buyers registering a new car in 2016.

Diesel and petrol cars continued to be by far the most popular fuel types for consumers with market share at 47.7% and 49% respectively, although demand for alternatively fuelled vehicles (AFVs) rose 22.2% across the year with plug-in hybrids and petrol electric hybrids up 41.9% and 25.1% respectively. More than 10,000 motorists chose to go fully electric in 2016 – up 3.3% on 2015.

Mike Hawes, SMMT chief executive, said, ‘Despite 2016’s political and economic uncertainties, the UK’s new car market delivered another record performance as car makers offered an incredible range of innovative and high tech models. 2017 may well be more challenging as sterling depreciation raises the price of imported goods but, with interest rates still at historic lows and a range of new models arriving in 2017, there are still many reasons for consumers to consider a new car in 2017.

‘Looking longer term, the strength of this market will rest on our ability to maintain our current trading relations and, in particular, avoid tariff barriers which could add significantly to the cost of a new car.’