I’ve seen numerous press releases and news articles recently, proclaiming that various different areas of the automotive industry are recovering well. They quote comparison numbers up by 100%, 200%, all the way up to 3,200%.
But these numbers are meaningless. They compare to one of the poorest months, not just of last year, but ever. Let’s not forget where we were in April 2020 (most of us at home…), it was the first full month of COVID-19 lockdown one – that one where everything stopped. Shops closed, dealerships shut, a large number of garages also felt it wasn’t worth the risk to open. There were no big internet platforms to help, and the entire automotive industry ground to a halt.
So what is being compared? Well, the SMMT recently announced its new-car registrations in April 2021. Credit to the industry body, they never actually referenced the percentage growth in their release, and highlighted the poor comparison. Still, many outlets proclaimed recovery, with figures up almost 3,200%.
Various news outlets completely forgot that the best option is to compare to 2019 to get the best idea of ‘recovery’. And if you do that, you see there’s a long way to go. There was actually as 12.1% decline in April 2021 against April 2019. March saw a drop of 38%, February down 37.4% and January fell 43.9%.
But – the numbers in the first quarter are also meaningless as dealerships were closed. That also, therefore, renders the SMMT’s used-car sales figures practically null-and-void. This market fell 8.9% year-on-year, but in 2020, until the last week of March, dealerships were open. Taking that into account, an 8.9% drop is really good, highlighting how far online car-buying has come in the last 12 months.
Then there are MOTs. Some companies have reported that bookings are up by 150% upwards in April. Sounds fantastic? In April 2020 there were 746,157 carried out after the government extension scheme was implemented. So this means last month would have seen around 1,865,392 tests conducted. Still sound good? It’s an improvement – but the average for April is just over 3.5 million. There are 23,237 MOT stations in the UK (according to government figures from January 2021). So, an MOT station has lost around 70 tests in the month, where they would conduct around 150 on average.
The impact of COVID-19 last year means that until at least April 2022, any figure comparison will be meaningless. The best option is to compare to 2019 – although even then you have to factor in other circumstances – the UK was still part of the EU, and some companies may have required financial cutbacks in that time, which would have impacted the economy and affected jobs and spending. The truth is, we need to ride out this year, and use 2022 as a new base for number comparisons going forward.
So numbers are meaningless. Well, most of them. The ones that matter is the number of COVID-19 infections and deaths. These comparisons are not meaningless, and these are the only numbers I’m thankful to see decrease. With vaccination levels rising as well, let’s just start to enjoy this year – carefully though…