The number of new LCVS registered increased by 7% in July, the first monthly year-on-year increase since January, fuelled by pent-up demand from operators after lockdown restrictions have been lifted.
In all, 27,701 new LCVs joined Britain’s roads, compared to 25,862 in July 2019, according to the latest figures by the Society of Motor Manufacturers and Traders (SMMT).
The uptick in demand is welcome news for the sector, which has seen monthly year-on-year falls since January, most of which is directly attributable to the Covid-19 pandemic and subsequent lockdown of the UK, which saw many dealerships closed for a number of weeks.
New registrations were down 25% year-on-year in June, as many operators were still in the process of coming out of lockdown and unfurloughing workers. By July, many businesses were up and running again.
July’s improvement comes against a backdrop of prolonged reduced demand, with overall LCV registrations down by 38.6% in the year to date.
Growth was particularly pronounced in medium-sized vans weighing greater than 2.0 to 2.5 tonnes, which saw a 12% increase in registrations, while the 2.5 to 3.5 tonne market – the biggest selling sector – was up by 5.4%. This has been driven by commercial and fleet buyers adding to their rosters, especially those involved in online delivery, which has boomed this year.
Pick-ups also bounced back strongly, with dealers recording a 25% increase in sales. There was also a 78% increase in 4×4 demand, but this class of vehicle represents a small fraction of total LCV registrations.
The only class to register a fall in sales was in the light van (less than or equal to 2.0 tonnes) sector, where registrations dropped by 22%. This is perhaps not surprising as they are generally bought by self-employed people, many of whom are trying to build business back up to pre-Covid levels.
As usual, the biggest selling van in July was the Ford Transit Custom, which shifted 3,405 units. This was followed by the Mercedes-Benz Sprinter, which had a particularly good month and sold 2,581 units. The Ford Transit was the third biggest seller, followed by the Volkswagen Transporter and Vauxhall Vivaro.
In the year to date, the Ford Transit Custom has sold nearly twice as many as its nearest rival, which is now the Mercedes-Benz Sprinter, closely followed by the Ford Transit. The Vivaro and Transporter are fourth and fifth biggest sellers respectively.
But while sales recovered last month, there are still notes of caution. For example, current stocks of panel vans are reasonably high, which is allowing for prompt deliveries to customers, according to the National Franchised Dealer Association. However, the trade body warns that if demand holds up going forward, a situation could arise where availability is restricted due to factories across Europe not being fully operational.
Likewise, the latest SMMT Outlook estimates that about 270,000 LCVs will be registered by the end of the year, a drop of 26% year-on-year.
Mike Hawes, SMMT chief executive, said: “With lockdown restrictions rolling back and businesses restarting operations, the van market is beginning to look more positive. Growth is likely to have been driven by pent up demand and the re-emergence of sectors such as construction.
“However, these green shoots of recovery could prove fragile given the uncertain economic situation. With new technology coming to the market and the need for operators to renew their fleets, maintaining overall business confidence will be crucial.”