New car registrations hit a 23-year low in September, industry data showed on Tuesday, as the global semiconductor shortage weighed heavily.
According to the Society of Motor Manufacturers and Traders, 215,312 new cars were registered last month, a 34.4% slump on September 2020, when pandemic restrictions were continuing to curtail sales.
It is the weakest figure since September 1998, when numbers fell ahead of changes to the number plate system coming into force. The SMMT said the semiconductor shortage was “impacting vehicle availability”.
Chip manufacturers are struggling to catch up with a surge in demand. Lockdown caused sales of small electronic devices such as laptops to spike, with demand for a range of products, from computers to cars, increasing as economies re-opened. Compounding the issue have been bottlenecks and other issues in global supply chains, including higher freight costs.
Demand for electric cars fared better, however. There were 32,721 new battery electric vehicle (BEV) registrations in September, accounting for 15.2% of all vehicles sold. That was well ahead of the year-to-date market share for BEVs of 9.5%. SMMT said it was the best month on record for BEV registrations.
Plug-in hybrids saw market share improve to 6.4%, and there were 24,961 new registrations for hybrid electric vehicles, taking their market share to 11.6% from 8.0% a year previously.
Mike Hawes, SMMT chief executive, said: “This is a desperately disappointing September and further evidence of the ongoing impact of the Covid pandemic on the sector. Despite strong demand for new vehicles over the summer, three successive months have been stalled by supply due to reduced semiconductor availability, especially from Asia.”
Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said: “Car registrations usually surge in September, due to the semi-annual number plate change, but supply chain issues prevented orders being fulfilled in the usual way. Demand is subdued, but not to the extent implied by the SMMT’s data.
“Looking ahead, the recent decline in consumers’ confidence and the impending squeeze on real incomes from high inflation suggests that car sales will remain below pre-Covid norms over the next 12 months, even if supply chain issues can be resolved.”
