UK Automotive Market Experiences Growth in 2023
In January 2023, the automotive industry in the UK experienced a period of growth. This was reflected in the new car registrations, which increased 14.7% year on year, reaching 131,994 units. The Society of Motor Manufacturers and Traders (SMMT) reported this was the best start to the year since pre-Covid January 2020. According to SMMT Chief Executive Mike Hawes, the automotive industry is already delivering growth that bucks the national trend and is poised to accelerate the decarbonisation of the UK economy with the right framework in place.
Meanwhile, the used vehicle market has also seen an uptick in demand. The Manheim Used Vehicle Value Index increased 2.5% in January from December. This is the second consecutive monthly increase, and the largest month-over-month rise since a 3.9% jump from October to November 2021. Cox Automotive reported that the average listed price of a used vehicle in December was $27,143, down nearly 4% from a year earlier.
The electric vehicle sector has also seen significant growth. The Federal Chamber of Automotive Industries (FCAI) reported that the Tesla Model 3 was the third highest selling car in the market in January, with 2927 deliveries. Tesla also ranked ninth outright as a brand, with 3313 vehicles sold. The LCV sector is already delivering growth for the UK in 2023, with January experiencing record deliveries of battery electric vans – up 53.5% to 993 units.
Overall, the automotive market is in transition but fragile due to the challenging economic outlook, rising living costs and consumer anxiety over new technology. With China’s factory activity once again gaining pace, global supplies of parts and semi-conductors are set to recover, aiding better vehicle supplies and lower waiting period in future. The Passenger Vehicle category is already healthy, and this will further its growth.
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9. “Electric vehicles power rise in UK car sales despite weak outlook” The Guardian, 6 Feb. 2023, https://www.theguardian.com/business/2023/feb/06/electric-vehicles-rise-uk-car-sales-smmt-inflation-interest-rates
10. “Automobile retail sales rise 14% in Jan to cross 18 lakh unit mark: FADA” Rediff.com, 6 Feb. 2023, https://www.rediff.com/business/report/automobile-retail-sales-rise-14-in-jan-to-cross-18-lakh-unit-mark-fada/20230206.htm
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