The Society of Motor Manufacturers and Traders have reported a fourth consecutive fall in new car sales, blaming Brexit uncertainty and the governments crack down on air quality.
According to the SMMT, there was a nine percent decline in July compared to July 2016. Under 162,000 cars were sold.
The SMMT found a 20 percent drop in new diesel sales for the month the Government confirmed plans to ban the sale of petrol and diesel cars from 2040 to improve air quality.
“Poor air quality is the biggest environmental risk to public health in the UK and this government is determined to take strong action in the shortest time possible,” a government spokesman said on the ban.
“That is why we are providing councils with new funding to accelerate development of local plans, as part of an ambitious £3bn programme to clean up dirty air around our roads.”
The sale of Hybrid and electric sales jumped by almost 65 percent, with almost 9,000 models sold.
“The fall in consumer and business confidence is having a knock on effect on demand in the new car market and government must act quickly to provide concrete plans regarding Brexit.” said chief executive, Mike Hawes.
“While it’s encouraging to see record achievements for alternatively fuelled vehicles, consumers considering other fuel types will have undoubtedly been affected by the uncertainty surrounding the government’s clean air plans.”
“It is important to remember that there are no plans to charge drivers using the latest Euro 6 models and no proposed bans for conventional petrol and diesel vehicles for some 23 years.”
Samuel Tombs, chief UK economist at Pantheon Macroeconomics said the fall in sales showed that consumers are avoiding “big-ticket purchases” due to their lack of confidence amid big changes and uncertainty.
He also warned that prices of cars might increase by up to three percent in 2018 and 2019 due to the weaker pound.
“Car sales tend to lag consumer confidence by about six months – many of the cars registered in July will have been ordered several months ago – so the recent post-election slump in sentiment indicates that the downturn has further to run,” he said.