- Insights

LCV – Market Update 2022

The Commercial Vehicles market has been met with a variety of challenges throughout 2022 so far. Ongoing supply chain problems, post-pandemic blues, the Ukrainian war and a cost-of-living crisis are all factors that have continued to cause a detrimental impact. This impact has led to eight consecutive months of commercial vehicle registration decline from January to August. September, however, bucked this trend and marked the first growth in registrations for the LCV market this year.

As we look forward to 2023, SMMT Chief Executive, Mike Hawes had this to say,

The UK’s van market continues to be shackled by supply shortages amid difficult operating conditions, which will likely continue into 2023, easing over the course of the year. Demand for zero emission vans remains robust despite these challenges, but a successful net zero transition will require measures targeted at long-term operator confidence.”

Our Commercial Vehicles Sales Manager, Scott Barnett, shared his experience of the current market climate, 

I have spoken to many businesses linked to the commercial vehicle market towards the end of last year, and their main concern going into 2022 was stock. Some even expected stock to be an issue into 2024 and it looks as though they will be right. Due to product supply some fleets and small businesses have been required to run their vehicles for a longer than originally anticipated as they await confirmation of product availability. 2022 has continued to see further increases in the price of vehicles , and the cost of borrowing. This is applying greater pressure to the market and there is no doubt that these uncertainties are damaging demand in the short term.”

For the remainder of 2022 LCV registrations are expected to fall by -13.7% on the 2021 total. There is a however expected to be a rise of 53.1% in the BEV (Battery Electric Vehicle) share of the market in comparison to last year’s figures. Mike Hawes, SMMT’s chief executive commented, “In these circumstances, the continued growth in electric van uptake is admirable as the industry strives to deliver its Net Zero commitments.”

Looking ahead to 2023

2023 holds a more positive outlook. LCV registrations are expected to be around 357,000 units, rising by 16.4% on the 2022 outlook. There is also no sign of the demand for electric vehicles slowing down. LCV BEV volumes are expected to rise 68.8% on the 2022 view and take a 9.2% market share. It is likely that going forwards this will encourage a greater charging infrastructure roll out.
Scott Barnett commented,

We have seen a real shift in the market towards the greener commercial options and larger fleets continue to lead the way with commitments to reduce their carbon footprint. We have seen a number of new BEVs and the Commercial Vehicle show, hosted at NEC Birmingham, had the UKs first fully electric pick up.”

Despite the many ongoing global factors impacting the market, improvements are on the horizon for both Electric and non-electric vehicles in 2023. To combat supply chain problems in the meantime, it is crucial to place orders well ahead of the delivery date required to manage any delays.

[Source: Mike Hawes, Chief Executive SMMT, ssmt.co.uk]

[Source: https://www.smmt.co.uk/2022/08/july-lcv-market-down-despite-increasing-demand-for-electric-vehicles/ ]

Scott Barnett LCV MarketScott Barnett, Sales Manager – Commercial Vehicles

Manager of our nationwide sales team providing bespoke vendor finance solutions to the commercial vehicle sector, Scott has over 17 years’ experience in the finance industry.

If you’re interested in finding out more about how we can support you with your Commercial Vehicle finance, please get in touch with Scott on +44 (0)7557 845 344 or email scott.barnett@uk.bnpparibas.com

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