Updated: 22:57 AEDT, 5 December 2024
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Electric vehicles accounted for more than a quarter of all new cars bought in the UK last month but demand is being propped up by 'unsustainable' manufacturer discounts, the trade body has warned.
New car sales in the UK declined by 1.9 per cent in November, with 153,610 motors joining the road, latest figures from the Society of Manufacturers and Motor Traders reveal.
EV sales rose for an eleventh consecutive month - up 58.4 per cent - to represent 25.1 per cent of all new registrations - the highest share of sales battery cars have secured in a single month in almost two years.
In contrast, petrol and diesel car registrations fell by 17.7 and 10.1 per cent respectively in November.
However, industry bosses said the figures masked the sector's ‘continued struggles’ to meet the Government's aggressive Zero Emission Vehicle (ZEV) mandate targets introduced this year, with fines looming for manufacturers who fail to meet the designated quota.
The ZEV mandate, launched in January, is designed to force makers to increase their share of electric vehicle sales in each of the next six years as part of the phase-out of new petrol and diesel models from 2030.
For this year, the mandate requires that 22 per cent of every brand's sales are fully electric, rising to 28 per cent next year and 33 per cent in 2026.
For 2024 so far, manufacturers as a whole are well short at just 18.7 per cent, the official figures show, despite offering discounts totalling £4billion as part of efforts to make EVs more appealing to drivers.
EV sales rose for the eleventh consecutive month in November, up 58 .4 per cent to 25.1 per cent overall, in contrast petrol and diesel car registrations fell by 17.7 and 10.1 per cent respectively, SMMT data shows
In order for electric car sales to be met, industry voices are calling on the government to ‘urgently reviews the market regulation and the support necessary to drive it,' the SMMT said.
Mike Hawes, its chief executive, added: ‘Manufacturers are investing at unprecedented levels to bring new zero emission models to market and spending billions on compelling offers. Such incentives are unsustainable – industry cannot deliver the UK’s world-leading ambitions alone.’
Ford's UK boss this week demanded a return of subsidies for EVs that were scrapped over two years ago in June 2022.
Lisa Brankin, UK chair of the car maker, said flagging demand needed to be boosted by a 'substantial' grant, or by another financial incentive like a cut to VAT on new EV prices.
The government recently met with industry leaders to discuss the ZEV mandate and ways to help beleaguered firms meet the strict thresholds introduced this year.
However, many parties aren’t with the government's direction.
Fleet sales, that represent the bulk (59.9 per cent of the market), fell by 1.1 per cent to just 91,933 units last month
2024: 22% (10% for vans)
2025: 28% (16% for vans)
2026: 33% (24% for vans)
2027: 38% (34% for vans)
2028: 52% (46% for vans)
2029: 66% (58% for vans)
2030 (ban on sales of new petrol and diesel vehicles): 80% (70% for vans)
2035 (ban on sales of new hybrid vehicles): 100% (100% for vans)
Source: DfT
Going further in the widespread criticism of the Government's EV sales targets, Jon Lawes, managing director at Novuna Vehicle Solutions, rubbished the ZEV mandate calling it ‘not fit for purpose’.
‘Industry still supports the ambition to ramp up EV adoption but there are two trade-off’s the government can no longer ignore,' he said.
'Policymakers must either revisit the structure of quotas but accept a slower transition, or soften penalties on manufacturers but accept the need for more adoption incentives.
‘The government needs to deliver a swift conclusion to its review, introducing more fiscal support and ending any disconnect with the 2030 ICE [internal combustion engine] phase-out timeline, which will otherwise continue weighing on the used-EV market.’
The ZEV mandate introduced in January and sets binding EV sales targets that increase annually over the next decade
There’s also a concern that announcements in the Autumn Budget VED tax increases will dampen EV demand for private buyers.
James Hosking, managing director of AA Cars said: 'Shifting consumer priorities and broader economic pressures have stalled recovery, further impacted by the Autumn Budget’s tax increases.
'These include inflation-linked Vehicle Excise Duty (VED) hikes from April 2025 and higher first-year rates, which have dampened buyer sentiment.'
Despite this the SMMT says that 'with the right, responsive market regulation, however, the UK could hold a commanding position as an exemplar global market for a rapid zero emission transition'.
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