If you thought things were tough for you with lockdown, spare a thought this week for the UK car industry. Sales of new cars plummeted by a massive 97 percent in April, with under 1000 new cars sold to private customers last month. That is the lowest level of new car sales since the end of the second world war, during the recession of 1946.
Arial photographs have emerged of disused airfields full of unsold vehicles waiting to be moved into dealerships. Ordinarily, these storage facilities would be used a day or two at most, before the vehicles are moved on, but now the holding storage areas are literally overflowing with unsold vehicles.
Currently, car dealerships remain on lockdown until at least June 1st, and will require stringent Health and Safety Executive clearance before they are allowed to open their doors to the public. This means that there will inevitably be a backlog of May vehicles too waiting to be moved. While some car manufacturers have been operating online to keep some sales trickling through, until people are able to visit and look at cars in person, sales will inevitably remain way below usual sales volumes when compared to previous years.
Sales to the general public were down from 68,000 car sales in March to just 871 new cars sold in April. The picture was equally bleak for fleet sales, which were down from 93,000 to 3,500.
While industry analysts expect there to be some immediate bounce back once dealerships reopen to service the pent-up demand, a second wave of coronavirus could put paid to any long-term recovery, leaving the car industry in a very precarious position. Couple this with the inevitable unemployment and fallout from COVID, including a potential global recession, this does give customers some good news that later in the year may see car prices drop to new lows, as dealers seek to create some volume of sales.
Our advice, if you’re in the market for a new motor would be to hold off till the second half of the year to see what deals are available. And if you are in the market for a new car, do yourself a favour and use our free quote form to ensure you get the best possible deal on your car insurance renewal premium in less than 3 minutes.