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UK demand for new cars plummets 89% in May

The weakest May sales figures since 1952 cast dark clouds over the UK automotive sector.

Tom Harrison
Content writer
2
minute read
posted 5 JUNE 2020

The UK automotive industry slumped to its worst May performance for 68 years as the sector all but “ground to a halt” last month.

The 20,000 new cars registered – compared with 184,000 in the same month last year – represent a colossal 89% downturn in demand, as the devastating impact of lockdown on sales is laid bare.

This week’s reopening of car showrooms in England marks what is now a “pivotal moment” for the industry, according to the Society of Motor Manufacturers and Traders (SMMT), which says jobs are on the line.

Half a million sales down

After the UK sector’s slowest May since 1952, the figures show just over half a million new cars have been sold in the first five months of 2020, compared with more than one million at the same point last year.

Car showrooms across the UK were closed for the whole of May, but limited deliveries of new vehicles ordered online were able to take place.

Showrooms have been able to reopen in England since Monday but remain closed in Scotland, Wales and Northern Ireland. And as Dan Hutson, head of car insurance at comparethemarket.com explains, it may be too early to expect an immediate revival.

“As is the case with many sectors in the UK, the car industry has all but ground to a halt,” he said. “While there may be some pent up demand from prospective car buyers, the financial impact of the coronavirus could mean that people will further delay buying a new car unless absolutely necessary which could mean a slower return to pre-coronavirus sales levels.

“With showrooms now open, we can expect that the statistics for June will show some increase in car buying which should then steadily increase. However, it may be too optimistic to expect a flood of new car sales.”

Showroom reopening ‘pivotal’

Mike Hawes, the SMMT’s chief executive says return of showrooms in England is the first step on the long road to recovery.

“After a second month of shutdown and the inevitable yet devastating impact on the market, this week's reopening of dealerships is a pivotal moment for the entire industry and the thousands of people whose jobs depend on it,” he said.

“Restarting this market is a crucial first step in driving the recovery of Britain's critical car manufacturers and supply chain, and to supporting the wider economy.”

The Guardian reported on Wednesday that the SMMT has been in talks with the Government over a possible £1.5 billion scrappage scheme that would take £2,500 off the price of a new car to stimulate the market.

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