New car sales reach record high in 2016

The number of new cars sold in the UK rose to an all-time high in 2016, after a year-on-year increase of 2.3% took the total to 2.69m.

The figures, released by the Society of Motor Manufacturers and Traders (SMMT) today (5 Jan), show that alternative fuel vehicles (AFV), which include electric cars, experienced the greatest growth – up 22% to 88,919. The number of new petrol (+2.7%) and diesel cars (+0.6%) also both increased.

A 4.8% rise in the number of fleet vehicles contributed towards the overall growth; the total of 1,380,750 new fleet vehicles represents 53.3% of market share.

However, the number of new private vehicles (-0.2%) and business vehicles (-1.2%) both declined year-on-year.

The figures correlate with the latest DfT statistics, published in November, which show motor vehicle traffic at a record high in the year ending September 2016. The provisional figure of 320bn vehicle miles travelled represents a year-on-year rise of 1.4% and is also 1.8% higher than the pre-recession peak in the year ending September 2007.

The SMMT says that a wide choice of new car models and affordable finance deals helped drive the market to a new high, with a fifth consecutive year of growth. However, it says that continuing that growth in 2017 may be ‘more challenging’.

Mike Hawes, SMMT chief executive, said: “Despite 2016’s political and economic uncertainties, the UK’s new car market delivered another record performance as car makers offered an incredible range of innovative and high tech models.

“2017 may well be more challenging as sterling depreciation raises the price of imported goods but, with interest rates still at historic lows and a range of new models arriving in 2017, there are still many reasons for consumers to consider a new car in 2017.

“Looking longer term, the strength of this market will rest on our ability to maintain our current trading relations and, in particular, avoid tariff barriers which could add significantly to the cost of a new car.”