Private demand for new diesel cars is growing faster than for pure battery electrics, according to recent figures. The Society of Motor Manufacturers and Traders (SMMT) reported a 17.1% increase in registrations of new diesel cars for private buyers in September compared to the same period last year, representing a rise of 1,367 units. In contrast, there was only a 3.6% year-on-year growth for pure battery electrics, with an increase of 410 units despite substantial discounts offered by manufacturers. The SMMT highlighted that car makers are expected to spend around £2 billion on discounting electric vehicles (EVs) this year to counter the lack of demand. September saw a record month in terms of overall battery electric new car registrations, reaching 56,387 units.
Senior UK leaders at major vehicle manufacturers such as Ford, Stellantis, JLR, and Volkswagen Group have appealed to Chancellor Rachel Reeves for urgent support to encourage more consumers to switch to electric vehicles. Ahead of the Budget on October 30, they have proposed measures including halving VAT on new EV purchases and reducing VAT on public charging from 20% to 5% to align with the home charging rate. The aim is to boost the electric motoring transition by enhancing consumer choice, affordability, investment attractiveness, job creation, air quality, and economic growth.
Manufacturers could potentially miss targets set by the zero emission vehicle mandate, which requires a percentage of new cars and vans sold in the UK to be zero emission. Failure to meet these targets could result in financial penalties for manufacturers. The overall number of new car registrations in September rose by 1.0% year on year to 275,239 units, with growth mainly driven by fleet purchases. However, private consumer demand declined by 1.8%, and the business sector also saw a decrease in volumes.
Mike Hawes, chief executive of the SMMT, expressed concerns about the slow growth of the electric vehicle market in meeting mandated targets, stating that the current market weakness is putting environmental ambitions at risk. Ian Plummer, commercial director at Auto Trader, noted the surge in electric vehicle sales in September, attributing it to record discounts provided by brands and retailers to stimulate sales. He emphasised the need for additional measures to overcome the cost barrier associated with electric cars, which still carry a price premium compared to internal combustion engine vehicles.
In conclusion, the call for governmental support to accelerate the transition to electric vehicles underscores the challenges facing the automotive industry in meeting sustainability goals while addressing consumer affordability issues in the shift towards cleaner transportation options.