The latest data from the Society of Motor Manufacturers and Traders (SMMT) has shown the number of new diesel car registrations fell a massive 30.6% in November. And despite increases in sales of petrol and alternatively fuelled vehicles (AFVs), the market is now in an eight month period of decline.
This decrease in the figures could be partially due to the recent Budget which raised the company car tax on diesel vehicles by 4%, making company fleets reluctant to upgrade to new diesel cars. It also raised the tax for most new personally owned diesel cars, with some popular models costing an extra £315 to tax than an equivalent petrol car.
For dealerships this is another blow for new car sales, although the message seems to be to focus on AFVs, for which sales rose 33.1%, and petrol cars which grew by 5%. The used car market also remains strong, and there is money to be made in aftersales, so the picture isn’t as grim as some would make out. With confusion over emissions targets and taxes, there is bound to be a dip in demand.
Mike Hawes, SMMT Chief Executive, warned about the consequences of rushing policy on emissions. “The decision to tax the latest low emission diesels is a step backwards and will only discourage drivers from trading in their older, more polluting cars. Given fleet renewal is the fastest way to improve air quality, penalising the latest, cleanest diesels is counterproductive and will have detrimental environmental and economic consequences.”