EV growth hindered by lack of incentives
【Summary】The lack of consumer incentives in the Autumn Statement could hinder the growth of the electric vehicle (EV) market next year, according to the Society of Motor Manufacturers and Traders (SMMT). While the overall new car market is performing well, the EV market is struggling to increase its market share. The SMMT calls for fiscal incentives for private consumers and a more equitable distribution of charging infrastructure.
An absence of consumer incentives in the November 22 Autumn Statement may result in a lackluster electric vehicles (EV) market next year, with the motor industry revising down growth to a 22.3% market share. Figures released by the Society of Motor Manufacturers and Traders (SMMT) show that although the October new car market surpassed pre-pandemic levels, the growth of EVs struggled to increase market share after 42 months of consecutive growth.
The 15th month of consecutive growth in the car market was mainly driven by large fleet registrations. Private demand remained stable, while the business sector saw a decline in registrations. Overall, vehicle uptake increased by 19.6% in the first 10 months, making it the best year since 2019.
In October, EV uptake continued to accelerate, accounting for 37.6% of all new car registrations. Hybrid electric vehicles (HEVs) and plug-in hybrid vehicles (PHEVs) also experienced growth. However, the market share of battery electric vehicles (BEVs) only saw a small rise compared to the previous year.
The SMMT highlighted the need for fiscal incentives for private consumers, as the majority of BEV registrations were from large fleet registrations. The organization also emphasized the importance of chargepoint infrastructure availability and accessibility, calling for more equitable distribution and pricing for public charging.
The SMMT CEO, Mike Hawes, urged the government to introduce incentives and facilitate infrastructure investment in the Autumn Statement to support the growth of EVs. The market outlook for 2023 has been revised upwards, but the expectations for BEV uptake have been slightly downgraded.
The National Franchised Dealers Association (NFDA) and other industry experts also highlighted the need for government support in the form of attractive price incentives and increased charging infrastructure to meet consumer demands. They emphasized that the lack of charging infrastructure and high prices remain barriers to EV adoption.
Auto Trader's commercial director highlighted the importance of affordable pricing for electric cars, as they have been selling well in the used car market. The director also mentioned that combining discounts and finance offers can make monthly payments for new electric cars comparable to petrol and diesel cars.
Close Brothers Motor Finance expressed concerns about a potential drop in demand for alternative fuel vehicles (AFVs), including EVs, following the government's delay in implementing the 2030 ban. They emphasized the need for dealers to stay informed about changing trends and stock their forecourts accordingly.
Looking ahead to next year, the market outlook for 2024 shows a revised down market share for BEVs, despite an expected increase in registrations.
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