In 2023, UK car sales surged to their highest levels since the pandemic, reaching over 1.9 million registrations, marking a significant growth of 289,000 from the 2022 low.
The driving force behind this boost was the incentive-driven fleet buyers, contributing 1.1 million registrations with a remarkable 38.7% year-on-year increase.
Despite the private market remaining stable at 818,000 registrations, challenges like the cost of living crisis and high interest rates limited further growth, with numbers still 17.7% lower than the pre-pandemic peak in 2019.
SMMT boss Mike Hawes expressed that the industry "faces 2024 with a lot more confidence and optimism”, anticipating a further push to 1.97 million registrations.
The key catalyst for this growth was the record adoption of electric vehicles (EVs), constituting one in six registered cars. Business and fleet buyers, drawn by compelling tax incentives, played a significant role, with benefit-in-kind tax rates set at just 2% until at least 2025.
Out of the total 315,000 EVs registered in 2023 (a 50,000 increase from 2022), 242,235 went to fleets, highlighting the impact of tax incentives. Hybrids also saw a 27.1% growth, capturing a 12.6% market share, while plug-in hybrids surged by 39.3%, claiming 7.4% of the market.
Consumer preferences remained consistent, with superminis and SUVs dominating at 29.8% (around 86,000) and 28.6% (82,000) of total car sales, respectively. Crossovers, exemplified by the Ford Puma, maintained a strong presence, securing a 28.3% (81,000) market share. These three segments have consistently led the market since 2013.
