SEPTEMBER saw the agency-only Mercedes brand see its first significant registration rise in 2023, but it’s been shortlived.
The brand went back into nosedive numbers in October – not by much admittedly – but negative by 122 units for the month. The result means Mercedes, which moved to the agency sales model in January, is still up in total sales for the first 10 months of 2023, but with a 2% growth figure it’s losing market share to a market that’s up almost 10 times that figure.
A year ago, Mercedes took 5.3% of the market; today it’s at 4.5% share.
In a bid to boost registrations, Mercedes-Benz UK is offering customers the chance to unlock what it says are exclusive in-store offers when they buy a new car. Running between 10-13 November, and called The Platinum Star Event, the in-store offers are in addition to any existing APR campaigns running on selected all-electric cars.
Mercedes retailers that spoke to Broker News on the condition of anonymity for fear of reprisals by the manufacturer, said their profitability has been significantly impacted this year.
Writing to Auto Retail Bulletin, Mercedes UK CEO Gary Savage claimed that dealer profitability was still strong and network average return on sales figure was currently at 2.5%, however he admitted this excluded loss-making LSH dealer group. Auto Retail Bulletin’s sources claim the total network RoS figure is 1.2%.
Market shake up
October SMMT new car registrations saw a shake-up in the market. Several brands which had been performing well for the year saw their fortunes fall while less successful manufacturers performed well in the month.
Overall new car registrations for the month were up 14.3% and for the year-to-date (YTD), new car sales are up 19.6%. Both are being driven by the company car market acquiring plug-in hybrids and fully electric cars. Fleet registrations are up more than 40% this year, against a private sales rise of just 1.6%.
Commenting on the latest figures Nick Williams, managing director, Lex Autolease, part of Lloyds Banking Group (pictured left below), said:
“It’s encouraging to see EV adoption levels and new vehicle registration figures continuing a positive trajectory. This is a real boost to the UK’s journey to net zero, with the Zero Emissions Vehicle Mandate enabling us all to set our sights firmly on the 2035 deadline.
“Drivers and fleet managers will hope to see the continued commitment of the UK government to development of the UK’s charging infrastructure, the maintenance of financial incentives to choose an EV, and policies to support vehicle manufacturers invest in innovation to drive adoption levels.”
Changing directions
Brands which saw a change in fortunes include Nissan, Ford, Mazda, Polestar, BMW and Tesla.
Nissan which is up almost 15,000 cars YTD saw a drop of more than 1,700 units in October. Similarly, Ford dropped just over 1,100 units in the month but is up nearly 16,000 for the year.
Mazda has been having a strong 2023 and is up more than 5,800 cars but it saw a fall of 337 units in October. Polestar is in almost the exact same position as Mazda; up approximately 5,800 for the year and down just over 300 for the month.
For BMW and Tesla the story is the other way around. BMW has been supply constrained and running down on 2022 for the majority of this year. However, a near-2,000 rise in October registrations has seen the brand move into a positive position for the year (by 559 units).
Tesla has been performing ahead of the market all year (currently up 31.6% YTD), but in October 2022 it sold 11 cars and last month it sold more than 2,600. It appears Tesla, which used to only deliver cars one month in three, is now delivering cars every month and smoothing out its supply.
Electric cars take over 16% market share YTD
Discounting in the electric car market has seen the BEV market share rise to 16.4% for the YTD, with registrations up 34% on the same time last year.
For the year, PHEV registrations are up nearly 37% and taking 7.1% of the new car market – just behind diesel’s 7.1% share. However, in October PHEVs took 9.3% share against diesel’s 7.3%.
Cars fuelled by petrol account for 69% market share so far this year, broadly in line with 2022.
October saw vehicle registrations grow for a 15th consecutive month – yet the automotive sector is at an important juncture,” commented Caroline Litchfield, partner and head of manufacturing and supply chain at independent law firm Brabners (left).
“Electric vehicle (EV) registrations for the year have almost already surpassed the number registered in the whole of 2022. However, this surge in demand has largely been driven by fleet sales rather than private buyers, with a recent NFDA survey indicating that price remains the biggest barrier for consumers.
“Consequently, consumers and businesses alike will be keeping a close eye on the King’s Speech and Autumn Statement in the coming weeks for policies that encourage EV adoption amongst everyday motorists,” she added.
Read September 2023 new car sales analysis
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Tristan Young is an award winning journalist with more than 25 years’ experience reporting on the automotive industry focussing predominantly on fleet and retail. As a self-confessed petrol-head, Tristan has a weakness for car classifieds. When he’s not writing about the automotive industry, he can usually be found outdoors with a small pack of border collies.
