The new car market suffered at the hands of the global chip shortage in 2022, with registrations down slightly compared with the year before. That’s according to new figures from the Society of Motor Manufacturers and Traders (SMMT), which says easing supply issues later in the year were not enough to undo the damage done during the first six months.

Although the SMMT says supply chains are “beginning to stabilise” and the shortage of semiconductors is “expected to ease”, problems earlier in the year took their toll on the market. With war in Ukraine and ongoing fallout from the Covid-19 pandemic, the market was down noticeably during the first half of the year.

However, the final five months of 2022 all saw the market grow in comparison with 2021, thanks to the easing of supply problems. Nevertheless, just 1.61 million new cars were registered in the UK last year, down two percent compared with 2021 and around 700,000 units below pre-Covid levels.

Car salesman working with client in dealership

There was good news to be found, though, as supply issues forced manufacturers to prioritise deliveries of low- and zero-emission cars. December saw electric cars claim their largest monthly market share ever, at 32.9 percent, while electric cars accounted for 16.6 percent of all registrations in 2022. That made electric cars more popular than diesels, which only made up 14.2 percent of registrations.

Hybrid vehicles also proved more popular than ever, claiming 11.6 percent of all new car sales to help reduce average CO2 emissions for new cars to 111.4g per kilometre. That’s a record low for the UK car market.

Toyota Prius

In 2023, the SMMT expects the market to grow as a result of improving supply, and the organisation claims there is “underlying demand” that cannot currently be fulfilled due to shortages. However, the organisation als warned that government support for zero-emission vehicles would be key.

Mike Hawes, the SMMT’s chief executive, said the ambition of manufacturers must be matched by that of the government.

“The automotive market remains adrift of its pre-pandemic performance but could well buck wider economic trends by delivering significant growth in 2023,” he said. “To secure that growth – which is increasingly zero-emission growth – the government must help all drivers go electric and compel others to invest more rapidly in nationwide charging infrastructure.

“Manufacturers’ innovation and commitment have helped EVs become the second most popular car type. However, for a nation aiming for electric mobility leadership, that must be matched with policies and investment that remove consumer uncertainty over switching, not least over where drivers can charge their vehicles.”

Little girl high fiving her father on the showroom floor of a dealership