July LCV market down despite growing demand for electric vehicles

The growth of battery electric van registrations in July helped offset another fall for the UK’s LCV market, new figures from the SMMT reveal.

The UK’s new light commercial vehicle (LCV) market declined for the seventh consecutive month in July, down -20.7% to 18,722 units, according to the latest figures published today by the Society of Motor Manufacturers and Traders (SMMT).

The decline, despite strong order books, is the result of ongoing global supply shortages caused by the Covid-19 pandemic, with last month’s registrations total some -23.9% below the pre-pandemic five-year average for July.

July saw a fall in registrations across all LCV segments, with some 14,782 new vans weighing above 2.5 tonnes up to 3.5 tonnes registered in the month, -11.2% below 2021. The number of lighter vans weighing less than or equal to 2.0 tonnes dropped by -20.3%, while those weighing more than 2.0 tonnes to 2.5 tonnes declined by -49.8%.

As industry investment in battery electric vans (BEVs) continues, with one in three models on the market now available with a plug, demand continues to increase with 765 BEVs registered in July, up 21.2%, and a continuation of increased uptake seen in the first six months of 2022.

As a result, there have been 8,865 BEVs registered in the year to date, an increase of 55.7%. This still represents only one in 18 of all vans registered so far in 2022 but is up from one in 37 a year ago.

With total registration volumes remaining weak, the industry outlook has been downgraded from 328,000 to 307,000 new registrations for the year, a decline of -6.5% on the previous outlook published in April. As a result, the market is now expected to finish -13.7% down on 2021, which saw uptake almost reach pre-pandemic levels.

With the semiconductor shortage expected to begin to ease during 2023, volumes for that year are anticipated to reach 357,000 units, a 16.4% rise. BEVs are still expected to account for 6.4% of registrations this year, while 2023’s outlook has been revised downwards slightly, from 9.6% to 9.2%.

Mike Hawes, SMMT Chief Executive, said: “The LCV market is struggling to recover post-Covid as global supply chain shortages and economic headwinds make the business environment even more challenging for both manufacturers and operators. In these circumstances, the continued growth in electric van uptake is admirable as the industry strives to deliver its Net Zero commitments. Given the importance of the commercial vehicle sector to Britain’s economy, its environmental ambitions and the need to keep society on the move, the next Prime Minister must look to restore economic confidence and support the sector’s transition to zero emission mobility.”