Is the September plate change losing its pulling power?
The September plate-change marks one of the year’s twin peaks for the new car market, when typically over 420,000 vehicles are registered. That’s almost double the volume of most months except for March, which remains the biggest and recently hit a record high of over 562,000 in 2017.
The two plate change months witness plenty of tactical OEM activity to encourage retail customers into showrooms with highly competitive low interest finance deals. It’s also a time for dealers to pre-register cars to hit the end of quarter sales targets set by their OEM partners.
The new 69-plate is particularly important as figures will be compared against a weaker September 2018, when registrations suffered a one-off hit following the introduction of the Worldwide Harmonised Light Vehicle Test Procedure (WLTP) at the beginning of the month.
Although the industry had known for some years when these European-wide rules would become mandatory, some OEMs failed to get vehicles tested and approved in time to go on sale in September 2018. Consequently the Society of Motor Manufacturers and Traders reported a 20.5% fall in registrations to 338,834 units, the lowest level for September since 2010.
This September sees the introduction of the next phase in emissions compliancy with the introduction of the Real Driving Emissions (RDE) testing regime, although sector seems better prepared, some OEMs are still late in securing type approval for their ranges and could take a sales hit.
The September plate-change also acts as a useful catalyst for the used market, with pre-registrations popping up on franchised forecourts over the coming months.
While this September will be stronger than last year, there’s a feeling that the second plate change of the year is losing its allure.
Speaking to me on a recent episode of the Motor Trade Radio podcast, Steve Brighton, managing director of Hepworth Motor Group, the West Yorkshire-based, multi-franchise business, said he has noticed a steady decline in September and a strengthening in the months leading up to it.
“We’re seeing a waning of demand for September with each manufacturer doing summer events to try and push registrations into July and August. September is driven by tactical; March is driven by retail demand because customers understand the 19-plate, but not necessarily the 69-plate.
“A number of people will buy the car on the 1 September because they want the latest plate, but then it’s a normal month, it’s not like March when each week is busier than normal.”
Also car ownership is becoming more transitory. The majority of new cars are funded through PCPs with the buyer keeping them for up to three years rendering the plate immaterial for most.
However, the plate change does offer a boost to the used car market thanks to the influx of part-exchanges, many of which will be coming off PCP schemes. Syed Ali, head of search at Honcho, the automotive digital marketing specialist, has tracked significant rises in searches for part-exchanges during plate-change months over the last five years.
“Consumer search behaviour during peak plate-change periods shows a consistent increase in the number of searches for part-exchanges. With the launch of the new 69-plate, dealers are likely to have a lot of used car stock to sell. Although most customers will be thinking about new cars, dealers cannot afford to ignore demand for used cars during September.”
When it comes to selling 69-plates, Ali advises dealers not to blow their marketing spend during the opening days of the month.
“Car buyers have become savvy with time and sometimes hold back on the temptation to buy new cars straight after the plate-change. Dealers need to adjust their marketing strategies with car buying patterns. Instead of going all guns blazing in the first week of plate change, shift some of the budget to the last week of the month.”
No matter how September pans out, the 69-plate will generate welcome footfall and enquiries and give dealers plenty of time to discuss new and used cars with customers planning their next purchase.