New car sales in the UK fell for a fourth month running in July as Brexit uncertainty weighed on demand and buyers shunned diesel cars in greater numbers.
Sales fell 9.3% last month to 161,997 new cars as consumers and businesses grew increasingly reluctant to commit to major spending decisions.
“The fall in consumer and business confidence is having a knock-on effect on demand in the new car market and government must act quickly to provide concrete plans regarding Brexit,” said Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders, which published the figures.
Sales of diesel cars were down by a fifth in July compared with a year earlier, to 69,157. Hawes blamed uncertainty over clean-air plans in the UK, after the government announced plans to ban all new petrol and diesel cars and vans from 2040 amid fears that rising levels of nitrogen oxides pose a major risk to public health. Sales of new petrol cars were also down in July, falling 3% to 83,969.
While diesel and petrol sales fell in July, there was a sharp rise in the sale of new alternatively fuelled cars, up 65% compared with the same month last year to 8,871.
The fall in new car sales in recent months has brought to an end to five years of growth – fuelled by cheap car finance deals – which has helped to underpin the consumer-led growth in the wider economy.
New car sales are now down 2.2% in 2017 so far, to 1.56m. The SMMT is forecasting a 2.6% drop in sales in 2017 overall, following a record 2.6m registrations in 2016.
Hawes said weaker demand for new cars should result in some cheap deals for consumers.
“The lower demand in recent months will inevitably mean competition from manufacturers will intensify and it will be a good opportunity for consumers to get a great deal on their next car.”
The top three bestsellers in July were the Ford Focus, Volkswagen Golf, and Nissan Qashqai.