Insight: what we've learned from June car sales
Growing popularity of previously niche brands and changes in powertrain choices are two of the trends in car-buying habits
Dramatic changes in buying habits emerged from UK car sales figures for June, the first full month that car retailers have been open post-lockdown.
UK new car sales fell 34.9% year on year in June. The figures from the Society of Motor Manufacturers and Traders (SMMT), announced earlier this week, show a significant improvement over April and May (down 97% and 89% respectively) but are still far from the industry's hoped-for comeback, after being out of action for more than two months.
SMMT chief executive Mike Hawes described June’s new car sales as “not a recovery and barely a restart.” He added: “Many of June’s registrations could be attributed to customers finally being able to collect their pre-pandemic orders, and appetite for significant spending remains questionable.”
There were 145,377 new cars sold in June, a decline of 78,044 units over June 2019. For the year to date, the market has fallen by almost half (48.5%), with 653,502 new cars sold in the first six months making it the lowest level since 1971.
However, while the decline certainly reflects economic uncertainty, UK-wide retailers are not yet fully up and running. Only English dealerships were open for the full month, with delayed reopenings for Welsh and Scottish showrooms. In England, one in five retailers remains shut and reports suggest upwards of 30% of sales staff remain on furlough.
The irregularities of the top 10 best-selling cars from the past few months started to normalise in June, with the main players, the Vauxhall Corsa and Ford Fiesta, back at number one and two spots.
That’s in stark contrast to April, when the Tesla Model 3 - never before even in the top 10 - became the best-selling car, with 658 sold. This was thanks to socially distanced delivery of a number of pre-ordered sales before the lockdown. Nevertheless, the electric Model 3 remains at number nine in June’s top sellers.
Tesla is one of just two manufacturers that have managed to grow UK sales in the first six months of 2020. The other is underdog MG, which has long been off the radar for most UK buyers. Thanks to its ZS EV - another electric car - MG achieved its best yet June volume, with 2025 cars sold and a record monthly market share of 1.4%.
For the year to date, the sales of Chinese-owned MG are up a quarter, moving it ahead of Dacia, Lexus and Mitsubishi in the sales charts and putting it within reach of Fiat, Mazda and Suzuki, which are all less than 1000 sales ahead, according to the SMMT figures.
Both Tesla's and MG’s success reflects the growing demand for plug-in vehicles, which was already on the rise pre-pandemic. Plug-in hybrids and electric vehicles held more market share than 'regular' hybrids in June, while pure EVs had a 6% share, with sales up by 262%, the equivalent of 8903 cars.
Despite this rise, Marshall Motors Group CEO Daksh Gupta, doesn’t believe it’s related to lockdown: “We are starting to see an increase in prominence of hybrid and EVs - but there’s a huge shortage in supply. There’s more appetite for environmentally friendly vehicles - but this was improving anyway rather than as a result of lockdown.”
Diesel-powered car sales, which have been steadily decreasing over the past few years because of the backlash following Volkswagen’s Dieselgate scandal, now account for less than a fifth of sales. Just 23,011 diesel vehicles were sold in June, compared with 87,896 petrol ones, the latter making up 60.5% of overall share. By comparison, in 2016, diesel car sales accounted for almost half of total volume.
Given the economic uncertainty, it’s no surprise that fleet sales fell by a substantial 45.2% in June, which the SMMT attributed to “businesses pausing purchasing amid expenditure reviews”. Private demand was more resilient, falling 19.2% compared with June 2019 and accounting for more than half of the overall market.
Of those private buyers, Gupta identified two key trends that are helping sales: those who would ordinarily use public transport and those described as ‘revenge buyers’ - the consumers who haven’t struggled during lockdown thanks to the furlough scheme or otherwise and want to treat themselves after lockdown and no longer have holidays high up their agenda. As a result, the number of cars part-exchanged - previously making up 63% of buyers - has now dropped to 50%.
Nonetheless, car retailers remain cautious about the year ahead. Jardine Motor CEO Neil Williamson described its sales in June as “better than our worst-case scenario”, adding: “Let's wait and see if it continues.”
Vertu boss Robert Forrester said: “June saw robust sales in all areas of the business, reflecting pent-up demand, and this is expected to continue for some time. We should not declare victory too early given the economic weakness likely to be created by the rise of redundancies across the UK and many sectors in major trouble. This may be only the end of the beginning.”
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