British people have suddenly stopped buying cars and as BI’s Jim Edwards notes, it’s not clear why.
As the following chart from Barclays shows, both new- and used-car sales have collapsed…
While the slump in consumer confidence remains a major factor…
as BI’s Jim Edwards notes, a number of other factors are colliding simultaneously to hurt UK car sales:
The rise of apps like Uber, Gett, and Lyft are making car ownership in urban areas less necessary.
British people have a close to zero household savings rate, and way too much debt, making further car purchases difficult.
Consumers are afraid a recession might be coming and have reduced their spending on expensive items.
The PCP car loan trend may have peaked, flooding the market with nearly new used cars.
A number of car manufacturers are offering “diesel scrappage schemes” in which they take your old diesel car if you trade in for a newer, cleaner vehicle.
The government announced it would ban sales of all petrol and diesel cars by 2040.
UK car sales are especially vulnerable to fluctuations in demand because Britain’s excess right-hand drive cars cannot be shipped to other areas of Europe, which use left-hand drive models.
