What is the new car sales crash and what does it mean for buyers?

Published 05 January 2018

New car registrations are falling. Indeed, according to the industry trade body, the Society of Motor Manufacturers and Traders (SMMT), new car sales dropped by almost six per cent in 2017, a decline not seen since the last recession, but what does it mean for car buyers in 2018?

Clearly diesel has played a huge part. In 2017 sales were down by more than 17 per cent with 219,309 fewer diesel cars being bought compared to 2016. During the same 12 month period, petrol registrations increased by 2.7 per cent.

However, despite the myriad of negative headlines, more than 2.5 million new cars were sold in 2017, which means the UK is still the second largest market in the EU, behind Germany.

Is this the end for diesel? 

It's too early to say. For sure, diesels have taken a battering over the past 12 months, but it's difficult to say for certain that this is the end. It could well be that diesels are once again becoming the niche choice for those who need them - i.e those who regularly travel long distances. Remember, they are generally the most-efficient powertrain you can get in a car and they are perfect for high-mileage drivers. Obviously, the VED changes, the diesel showroom tax and DPF problems have not have helped improve the appeal of diesel.    

Does that mean everyone is now buying petrol?

Yes and no. While petrol new car registrations are increasing, they're not offsetting the huge deficit in diesel. For example, that 2.7 per cent increase in petrol registrations in 2017 equates to 36,210 cars. And that leaves a rather sizeable 183,099 hole in UK showroom sales. 

Demand for electric, hybrid and plug-in hybrid cars reached a record high in 2017, with almost 120,000 hitting UK roads 

What about electric cars? They must be rocketing, right? 

Demand for electric, hybrid and plug-in hybrid cars reached a record high in 2017, with almost 120,000 hitting UK roads - an increase of 34.8 per cent on 2016. However, while more and more people are choosing electrified vehicles, they still account for just 4.7 per cent of all new car registrations. And it will be a good few years before that total gets anywhere near double digits. 

Does that mean now is the right time to buy a new car? 

In short, yes. dealers and manufacturers are battling it out for your business and there are some sizable savings to be made when it comes to buying a new car. If you have a car to trade-in, for example, you can take advantage of numerous scrappage schemes, which will give you a sizable discount when you part-exchange your old motor. There are also lots of competitive finance deals, with low interest rates and deposit contribution schemes. Make no mistake, car dealers want your cash and they'll do (almost) everything within their power to secure your business.   

What about nearly new cars?  

This could well be the sweet spot in the new car sales crash, because there are thousands of pre-reg deals out there. Pre-registered cars are effectively surplus stock, sold cheaply to dealers who register them and then sell them on as ‘ex-demo’ or ‘delivery mileage’ cars. You can save up to 30 per cent off the list price of the UK's best-selling models, like the Ford Focus, Vauxhall Astra and Volkswagen Golf. Obviously, you don't get to spec the car yourself - as you would with a factory-ordered model - but if you're not fussy about the colour or trim then you can make huge savings, especially if you need a diesel for a high-mileage commute.

What does the future hold for new car sales?

Without a crystal ball, it’s hard to say. But even the most optimistic experts at the SMMT believe that new car sales will drop by as much as seven per cent in 2018. That figure could accelerate if interest rates rise and make finance more expensive.


agedn    on 8 January 2018

What a surprise that sales are down. Electric cars are expensive and their batteries are bound to improve over the next few years so why get one now? As I understand it the emissions from diesel cars are bad for health in towns and cities but dont pollute the planet as much as the emissions from petrol cars, but the emissions from petrol cars are better for health in towns and cities (or is it the other way around?) The newest Euro 6 diesel cars are said to be cleaner than petrol cars and are, of course, far more economical. So what do we believe

Imagine this scenario which is fairly common. You have an electric car and are driving from Cornwall to London - just about possible on one charge with care. It is dark, raining and cold so you have your lights, heater and wipers on, as well as the radio. You are on the motorway. There is a crash ahead of you and the traffic grinds to a halt. The police close the road for 5 hours as they do from time to time. Electric car drivers will be watching their battery meters with concern because they need the heater and want to listen to the radio. When the police reopen the motorway and say that the traffic can move forward, how many electric cars will be left stranded?

So in my view the only option for a one car family is to have a diesel electric hybrid so that at least when the battery dies the diesel engine will be there to take over. But at the moment I will sit tight with the cars I have and wait for some clarity

   on 8 January 2018

I am on my second diesel, this one is an EU5 and now coming up to 7 years old. I only do about 7500 miles a year but 90% of the time journeys of at least 30 miles. I am happy with diesel and with the EU6 standard being cleaner and nearly as clean as petrol I will be going diesel again. All the councils imposing diesel charges seems to hit EU4 or earlier. Therefore from a charging point of view I see no problem. Electric is a no for me. However in the scheme of things I fail to understand why LPG seems to have disappeared when it will run in a slightly modified petrol engine and is super clean.
With so many moving to petrol I wonder how long it will be before theres concern at rising CO2 levels because of us owners buying petrol cars. It's our fault whatever we do.

conman    on 8 January 2018

Well said agedn. I am happy to stay with my diesel for now, to keep the Co2 levels down. what does the future hold for electric car drivers?
God help us in the future as at a local Aldi store I was witness to 2 people fighting over a pair of stuffed carrot toys, can't imagine what will happen if someone is desperate for a charging unit .

c Reed    on 8 January 2018

CO2 is a trace gas, less than 400 parts per million.

It is not a green house gas, water vapour is the most common green house gas.

CO2 makes plants grow, and produce oxygen, which can be considered important, well to some people anyway.

It is other pollutants which matter, so let us concentrate on these.

Compressed household gas , methane, is an excellent fuel for all return-to-base vehicles. Buses, municipal vehicles, et al.

Every taxi in any major Brazilian city uses compressed household gas.

It would nice if this subject became more sensible.

ageing P    on 8 January 2018

Aged N is spot on. The motorways will be blocked with elctric cars going nowhere. Plus capacity at service stations will have long queues and sufficient renewables in extreme cold won't be available to cope with the demand.

anthonyf    on 8 January 2018

I really don’t understand how public recharging points are going to replicate the speed of throughput provided by conventional fuel pumps now. Especially on a motorway.
And another point. What is the etiquette if you turn up as a guest to someone’s house and ask to plug in your electric car? After all you’d hardly ask them for a fiver for fuel would you?

   on 8 January 2018

I have an electric car, As a second car and runabout, its excellent. The range in midwinter, everything working is of the order of 90 miles. In summer, avoiding too much motorway driving, I can get 120
So i use the other car if range is an issue, The plus points;- I charge at home overnight with a conventional 13 amp socket; if I need a faster charge, I can do it in 6 hours or less with a charger supplied FOC. by HMG. It never needs warming up and doesn't care if i do 200 yards or 1 mile.
The acceleration to 50 is very brisk indeed. The drivetrain and batteries are guaranteed for 8 years.
It is very smooth and quiet and easy to drive, bland but comfortable. And running costs are less than 1/4 of petrol

NickNike    on 12 January 2018

What point are you tryingto make? It is your second car. So it's simply not good enough as your primary transport. You may have a range of 90 miles, but do you run it to the limit? Surely you need 20 miles or so spare. Electric cars at present are a nonsense. The technology is based on age old processes. We need a radical step-change in technology. And then nobody mentions the additional polution at power stations, comnverting fossil fuels into electricity and then into mechanical power. This whole electic thing has not been thought through.

R L Nunn    on 9 January 2018

Electric cars are no good if you live in the country. I couldn't even drive to Exeter and back on a charge unless it was a Tesla and unless I win the lottery that car is totally out of reach. I'll stick with petrol. Electricity has to be generated somehow and power stations are bigger polluters than any petrol/diesel cars. Power stations are just managing to supply ordinary consumers without the extra burden of people charging their cars 24/7. As usual a porely thought out strategy by the EU and our government regardless of political parties.Anybody who thinks their electric car costs a 1/4 of the running costs of a conventional engine is mistaken. Total the cost of running it after paying for your electricity at home, battery and drivetrain will have to be replaced after 8 years when the warranty expires, and nobody will buy your electric car when it gets close to 8 years unless the work has been carried out.

Peter Axworthy    on 10 January 2018

We are all but consumers who are left confused time after time just to keep an economy running. Sellers want your money, Government want you to buy to gain tax, buyers want something new to show of and so it seems 'Money makes the world go around' This applies to all things we buy. Just look at the adverts we are bombarded with all the time. Petrol, Diesel or any other form of power needed needs to feed of something else. If I invented a car tomorrow that runs on water the Oceans would run dry. I could go on but I have not got that much energy. Happy driving everyone whatever gets you from A to B.

aethelwulf    on 12 January 2018

My view is that many folk bought a car last year before VED shot up so do not need one for some time yet. So brought on by government action as ever just like the CO2 scam and global warming. The sun will burn out and life will end and no tax will stop that - or am I mistaken?
Meanwhile I will take the cheapest and most reliable motoring option available at the time and keep my vehicles at least 15 years to get my money back.

Dorset123    on 14 January 2018

The main issue with electric cars at the moment is that they will be worthless as they get older, a 6 year old electric car that someone I know, now only has a range of 50 mles so what use is that and of course who is going buy it from you. A petrol/diesel car will be in good condition at that age.

Edited by Dorset123 on 14/01/2018 at 20:54

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