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SMMT Car regs summary graphic Nov 23 2048x1024 1
SMMT

Only four weeks left to fix EV trade challenge

NOVEMBER proved a strong month for sales of both hybrid electric vehicles (HEVs) and plug-in hybrid vehicles (PHEVs), rising by 27.8% and 55.8% respectively. Fleets also continued to transition to battery electric vehicles (BEVs), buoyed by compelling tax incentives.

Of the 24,359 new BEVs reaching the road in November, 77.4% were taken on by fleets and businesses. While overall BEV volumes fell by 17.1%, leading to a reduced market share of 15.6%, last November was atypical with significant deliveries following supply chain disruptions. Year to date, BEV uptake is up 27.5% with a 16.3% market share – expected to rise to 22.3% next year.

However, with new regulation coming into force in January mandating that 22% of each manufacturer’s new vehicle registrations must be zero-emission, sustained recovery depends on inspiring consumers with fiscal incentives, as well as greater investment in essential charging infrastructure that gives drivers confidence. Halving VAT on new BEVs and reducing VAT on public charging to 5% in line with home charging would increase the attractiveness of driving electric and make the zero emission transition more accessible to a larger number of consumers.

Even more urgent is the need to delay tougher new UK-EU Rules of Origin which will begin on 1 January 2024. Failure to postpone these rules would see EVs traded both ways incur tariffs that would raise prices for consumers at a critical moment in the transition. With less than four weeks to go, carmakers and governments on both sides of the Channel have called for a common sense approach to retain the current EV battery rules for a further three years, which will support consumer choice and affordability.

Nick Williams, Managing Director, ​Lex Autolease, part of Lloyds Banking Group​ said: “Last month, electric vehicle (EV) registrations for the year surpassed the total number of EVs registered in the whole of 2022, with registrations now at 286,846, against a total 267,203 vehicles registered last year.

“Long-term commitments from policymakers, such as the ZEV mandate and 2035 ban on petrol and diesel vehicle sales, are continuing to support electric vehicle adoption as both buyers and manufacturers have the confidence to invest.

“The recent commitment from Nissan is a case in point. For the UK to lead in vehicle electrification and deliver the electric transition, it is vital we continue to encourage OEMs that Britain is the most attractive place to build their electric vehicles.”

Jon Lawes, Managing Director at Novuna Vehicle Solutions, one of the UK’s largest fleet operators, added: “The £2bn announced in the Autumn Statement to aid zero-emission vehicle manufacturing, combined with the UK’s first ever battery strategy and a promised consultation on fast-tracking charging infrastructure, have all been encouraging steps for the UK’s EV transition. However, the OBR is still predicting a dramatic fall in EV uptake and with the clock ticking on incoming tariffs, this poses a threat to UK vehicle manufacturing and undermines the commitments in last month’s budget.”

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