UK’s New Light Commercial Vehicle Market Shows Resilience
The UK’s new light commercial vehicle (LCV) market has demonstrated robust performance, with registrations growing by 2.4% in October 2024, reaching 26,974 units. This marks the third consecutive month of overall market growth and represents the best October performance in three years, according to data released by the Society of Motor Manufacturers and Traders (SMMT).
Market Segmentation and Trends
The growth was primarily driven by demand for small and medium vans, which saw significant increases of 55.9% and 49.6%, respectively. In contrast, the uptake of large vans decreased by 2.7%, although they still constitute the majority (65.6%) of the market. The demand for new pickups and 4x4s declined by 18.9% and 62.0%, respectively, following strong growth in the previous year.
Challenges Ahead for the Pickup Market
The future demand for new pickups is now at serious risk due to the recent Budget announcement to tax double-cabs as cars for benefit in kind and capital allowances purposes beyond April 2025. This change is expected to impose additional costs on vital industries such as farming, construction, and utilities. The industry is urging the government to reconsider this decision to avoid harming these sectors and the broader UK economy.
Electric Vehicle Uptake
On a positive note, demand for new battery electric vans (BEVs) rose for the first time in five months, increasing by 61.8% to 2,263 units in October. This represents 8.4% of the total new LCV market. However, over the course of the year, BEV uptake has declined by 1.9% compared to the same period last year, accounting for a 5.6% market share. This is significantly below the mandated level, despite manufacturers investing heavily in expanding Britain’s BEV offerings to over 30 competitive models.
Mike Hawes, SMMT Chief Executive, commented, “The continued growth in demand for new vans is encouraging, given this sector is a barometer of the health of Britain’s businesses. However, low demand for electric vehicles raises serious doubts over the UK’s ability to achieve its green targets. There must be an urgent review of the market, regulation, and support in place to avoid reduced UK investment, economic growth, jobs, and decarbonisation.”
Conclusion
While the extension of the Plug-in Van Grant into the next financial year is a welcome move, further measures are critically needed to boost the electric van market. The lack of suitable chargepoint infrastructure remains a significant barrier for fleet operators considering switching to electric vehicles. Addressing these challenges is crucial for the UK to meet its ambitious green targets and maintain its economic growth.
