SMMT: UK reaches million EV milestone as new automobile market grows

Britain’s millionth battery electrical automobile (BEV) reached the highway in January 2024, whereas the brand new automobile market grew 8.2% for the month, in line with the newest figures from the Society of Motor Producers and Merchants (SMMT).

The primary month of the 12 months noticed 142,876 new automobiles registered, an uplift of 10,882 models on January 2023, one of the best efficiency for the month since 2020 and the 18th consecutive month of development. The rise was pushed solely by the fleet market, which rose by 29.9%, whereas personal retail uptake fell -15.8%. Fleets accounted for greater than six in 10 (63.2%) new automobiles registered, up from simply over half (52.7%) final 12 months.

The market additionally – narrowly – reached its anticipated milestone of 1,000,000 BEV registrations since information started. Some 20,935 BEVs had been registered in January, an increase of 21.0% 12 months on 12 months, taking the general whole since 2002 to 1,001,677 – testomony to the dedication of producers to ship ever-increasing numbers of zero emission fashions.¹ BEV market share for January additionally grew 12 months on 12 months to 14.7%, though that is under the total 2023 efficiency of 16.5%. Plug-in hybrids (PHEVs) recorded quantity development of 31.1% to take 8.4% of the market, whereas hybrid (HEV) volumes fell -1.2% with a 13.1% share.

Volatility in BEV provide has been anticipated and is prone to proceed as producers regulate product allocation following the last-minute decision over UK-EU guidelines of origin, which had threatened to use tariffs to EVs, proscribing affordability. Nonetheless, whereas fleet and enterprise demand for BEVs grew by 41.7% in January, registrations by personal patrons fell by -25.1% – an ongoing pattern that can undermine Britain’s means to ship web zero.²

The UK is now the one main market to mix a 2035 finish of sale date with a mandated zero emission automobile market share, however with none vital shopper incentives. But it’s more and more clear that non-public patrons want extra assist to change. Forward of subsequent month’s Price range, trade is looking for presidency to assist customers by quickly halving VAT on new BEV purchases. Such a step would value the Treasury a median of simply £1,125 per automobile, which is lower than the price of the earlier Plug-in Automotive Grant and would put greater than 1 / 4 of 1,000,000 electrical – reasonably than petrol or diesel – automobiles on the highway by the top of 2026, on prime of these already anticipated. Not solely would this minimize CO2 by greater than 5 million tonnes throughout that point³, it might imply that the subsequent million EVs might be delivered in simply two years.

Quickly decreasing VAT on EVs would partly mirror the tax exemption already provided to customers on different carbon discount applied sciences equivalent to warmth pumps. Supporting the EV shopper at the moment would additionally guarantee wider advantages equivalent to rising the provision of used EVs, enlarging the general market to make it extra engaging for charging and manufacturing funding, and slashing Britain’s carbon footprint.

Mike Hawes, SMMT Chief Govt, stated,

It’s taken simply over 20 years to achieve our million EV milestone – however with the fitting insurance policies, we will double down on that success in simply one other two. Market development is at the moment depending on companies and fleets. Authorities should subsequently use the upcoming Price range to assist personal EV patrons, quickly halving VAT to chop carbon, drive financial development and assist everybody make the swap. Producers have been requested to produce the autos, we now ask authorities to assist customers purchase the autos on which web zero relies upon.

The newest 2024 outlook for the brand new automobile market estimates a complete general quantity of 1.974 million models, which is a 4,000 unit improve on the October estimate, however with the BEV forecast diminished to a market share of 21.0% over the 12 months, in contrast with the 22.3% anticipated in October and the 23.3% anticipated a 12 months in the past. Whereas myriad elements equivalent to excessive vitality costs, inflation and rates of interest, charging anxiousness and blended messaging from authorities have restricted demand, 100,000 extra BEVs will nonetheless attain the highway in 2024 in contrast with final 12 months, totalling some 414,000 models – multiple in 5 new automobiles. This quantity would improve even additional if a VAT discount on EVs was launched.

SOURCE: SMMT