Supply issues affect car and van sales

Registrations of both new cars and vans are up year on year, but have been hampered by shortages of parts

row of white vans

The latest data from the Society of Motor Manufacturers and Traders (SMMT) show that new car registrations grew 28.0% year-on-year in June to 186,128. This is despite the fact that semiconductor (a chip used in electronic devices) supply issues caused figures to fall short of industry expectations by around 9,000 sales. 

It’s unsurprising that figures are up compared to 2020, as this month last year saw the restrictions of the first lockdown start to lift, and car showrooms in England began to open up. 

However while sales of petrol and diesel cars struggled throughout the pandemic, there was a steady demand for electric vehicles and EV registrations are still on the rise. Battery electric (BEVs) and plug-in hybrid vehicles (PHEVs) combined accounted for 17.2% of new vehicles, with BEVs accounting for one in 10 of all sales. 

Mike Hawes, SMMT Chief Executive, said: “With the final phases of the UK’s vaccine rollout well underway and confidence increasing, the automotive sector is now battling against a ‘long Covid’ of vehicle supply challenges. 

“The semiconductor shortages arising from Covid-constrained output globally are affecting vehicle production, disrupting supply on certain models and restricting the automotive recovery. However, rebuilding for the next decade is now well underway with investment in local battery production beginning and a raft of new electrified models in showrooms. 

“With the end of domestic restrictions later this month looking more likely, business and consumer optimism should improve further, fuelling increased spending, especially as the industry looks towards September and advanced orders for the next plate change.”

Bumper van sales so far in 2021

Sales of new light commercial vehicles (LCVs) were up 14.4% on June 2020, with 34,363 vans registered. This means that currently 2021 is the third best year for van sales since records began, with 2019 seeing the highest recorded sales.  

Demand from the construction sector and a rise in online delivery business caused an increased need for vans as operators looked to renew and expand their fleets.

Growth slowed slightly compared to April and May of this year, and was down 13.9% compared to 2019, falling short of expected sales by more than 5,500 vans – again, due to the same supply shortages that affected car sales. 

Hawes added: “It’s good to see the van market continue to perform well, with pent up demand, online retail and the construction sectors all on the rise,” while also acknowledging that the lack of semiconductors affected production and extended lead times here too.