EV sales miss targets despite January uptick

The UK new car market fell by 2.5% to 139,345 units in January, according to new data released by the Society of Motor manufacturers and Traders (SMMT).

It attributes the dip to weak consumer confidence and tough economic conditions.

Registrations by both fleet and private buyers were down, falling by 3.7% and 0.5% respectively, and although business registrations rose by 2.4%, that translated to just 55 additional units.

In terms of fuel types, petrol car registrations dropped by 15.3% to comprise just over half (50.3%) the market, with diesel down 7.7% to claim a 6.2% share.

Both hybrid electric vehicles (HEVs) and plug-in hybrids (PHEVs) recorded volume growth to take a 13.2% and nine per cent share of the market respectively, while electric vehicles enjoyed the most significant growth, up 41.6% year on year to take a 21.3% market share. However, this remains short of last year’s 22% sales target set by the government, and a long way off the 28% sales target for 2025.

The SMMT said that private retail buyers still lack a meaningful fiscal incentive to buy an EV while the application of the Vehicle Excise Duty ‘Expensive Car Supplement’ (ECS) to BEVs in just two months – which will add a £3,110 tax bill to EVs priced over £40,000 – will further undermine the goal of a mass market transition.

Mike Hawes, SMMT chief executive, said:

“January’s figures show EV demand is growing – but not fast enough to deliver on current ambitions. Affordability remains a major barrier to uptake, hence the need for compelling measures to boost demand, and not just from manufacturers.

“The application, therefore, of the ‘Expensive Car Supplement’ to VED on electric vehicles is the wrong measure at the wrong time. Rather than penalising EV buyers, we should be taking every step to encourage more drivers to make the switch, helping meet government, industry and societal climate change goals.”

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