Press release

5 Feb 2024 London, GB

Automotive sector continues to grow, but concerns remain about 2024 – EY comments

The UK motor industry continues to show encouraging growth, with 142,876 new car registrations recorded in January 2024, representing an 8.2% year-on-year increase and the 18th consecutive month of growth.

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James White

Senior Executive, Media Relations, Ernst & Young LLP

Communications professional experienced in public relations, journalism and media relations. Aston Villa supporter. Passionate about sports and automotive. Former sports journalist.

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David Borland, EY UK & Ireland Automotive Leader, comments on the Society of Motor Manufacturers and Traders (SMMT) new car registration figures for January 2024:

“The UK motor industry continues to show encouraging growth, with 142,876 new car registrations recorded in January 2024, representing an 8.2% year-on-year increase and the 18th consecutive month of growth. The growth was predominantly driven by Battery Electric Vehicle (BEV) registrations, which were up 21% year-on-year, and Plug-in Hybrid Electric Vehicle (PHEV) registrations, which were up 31.1% compared to January 2023. Despite the growth in BEV sales and the cumulative milestone of one million sales in the UK being reached, the market share for BEVs was down to less than 15% for the first time in a year last month. This highlights the challenge that Original Equipment Manufacturers (OEMs) have to meet the target of ensuring at least 22% of their sales are accounted for by Zero Emissions Vehicles (ZEVs) as part of the ZEV Mandate, which came into law at the start of this year.

“In line with the trend the sector saw throughout last year, fleet sales once again were solely responsible for January’s growth, with an increase of 29.9% year-on-year, while retail was down 15.8%. This means that almost two-thirds of cars sold were to fleet, versus the traditional 50/50 split of fleet and retail. One critical challenge for manufacturers will be how to make this channel mix sustainably profitable.

“There is positive news on the supply side as well with manufacturing growth for 2023 at 17%, representing the best year since 2019. The deferral of the ‘rules of origin’ legislation will provide further impetus to automotive manufacturing, in the UK and continental Europe. 

Forward Look

“While the new year will undoubtedly present economic and regulatory challenges, the market is showing robust momentum as it heads into 2024 with further volume increases forecast for the year. This upward trend, coupled with the intensified competition from new market entrants, positions 2024 as another year of opportunity for the UK car industry to demonstrate its resilience and innovation.”