The Changing Landscape of Car Sales in 2024
Struggling New Car Sales
In early 2024, the motor trade industry is facing challenges with shifting new cars. Some dealers are even considering dropping their franchises due to higher prices and limited options for buyers.
Platts of Marlow’s Dilemma
At Platts of Marlow, a Ford retail dealer with a century-long history in Berkshire, the situation is dire. The chairman, Jim Platt, reveals that the dealership is left with only a handful of Ford models to sell. The absence of popular models like the Fiesta and the impending discontinuation of the Focus have led to a 30% decrease in new car sales.
Shift Towards Used Cars
To combat the decline in new car sales, many private customers are turning to used and nearly new cars instead. However, sourcing these vehicles is becoming increasingly challenging as dealers compete for limited stock.
Decline in New Car Sales
Summit Garage in Dudley, West Midlands, is also experiencing a decline in new car sales to private customers. Despite holding the MG franchise, the dealership is planning to exit due to dwindling retail sales.
SMMT Figures
Figures from the SMMT reveal a 12.9% drop in new car sales to private buyers in May, contributing to an overall decline of 11.3% since the beginning of the year. The pressure on manufacturers to meet ZEV mandate requirements adds to the challenges faced by the industry.
Consumer Preference for Used Cars
Many private buyers are showing a lack of interest in electric vehicles, opting instead to keep their current cars or switch to smaller combustion-engined models. This shift is evident in the best-selling new cars to private buyers, with the Ford Puma leading the pack.
Rise in Used Car Sales
While new car sales struggle, the market for used cars is thriving. Sales of used cars have increased by 6.5% in the first three months of the year, reaching a five-year high. Petrol superminis, particularly Ford’s Fiesta, are among the top sellers in this segment.
Conclusion
As new car showrooms face challenges, used car forecourts are witnessing increased activity. The shift towards used cars reflects changing consumer preferences and market dynamics in the automotive industry.
