Electric vehicles accounted for more than a quarter of all new cars bought in Britain last month, but demand is being supported by ‘unsustainable’ discounts from manufacturers, the trade body has warned.
New car sales in Britain fell 1.9 percent in November, with 153,610 cars on the road, according to the latest figures from the Society of Manufacturers and Motor Traders.
Electric vehicle sales have increased for the eleventh month in a row – by 58.4 percent – and represent 25.1 percent of all new registrations – the highest number of battery cars sold in a single month in almost two years.
In contrast, registrations of petrol and diesel cars fell by 17.7 and 10.1 percent respectively in November.
However, industry bosses said the figures masked the sector’s “ongoing struggle” to meet the aggressive targets of the government’s Zero Emission Vehicle (ZEV) mandate introduced this year, with fines threatened for manufacturers who not meeting the established quotas.
The ZEV mandate, launched in January, aims to force manufacturers to increase their share of electric vehicle sales in each of the next six years as part of the phase-out of new gasoline and diesel models from 2030.
For this year, the mandate calls for 22 percent of each brand’s sales to be fully electric, rising to 28 percent next year and 33 percent by 2026.
For 2024, manufacturers as a whole are well short of just 18.7 per cent, the official figures show, despite offering discounts totaling £4 billion as part of efforts to make electric vehicles more attractive to drivers.
Sales of electric vehicles increased for the eleventh month in a row in November, by 58.4 percent to 25.1 percent overall, while registrations of petrol and diesel cars fell by 17.7 and 10.1 percent respectively. according to data from SMMT.
The ever-growing pressure of the ZEV mandate dominates the new car market.
EV sales may have reached their highest market share since December 2022, but November is only the second month this year in which EV uptake has exceeded mandated levels.
And sales of battery-powered cars are being boosted by manufacturers cutting the price of new electric cars in a bid to stimulate demand, experts suggest.
The SMMT says carmakers have offered discounts of up to £4 billion by 2024 in a bid to boost demand.
Heavy discounting is just one of many industry tactics – from setting up dealer demonstrators to aggressively positioning the mobility market and limiting sales of gasoline-powered cars – being used by beleaguered manufacturers as they push to reach 22 sales this year. percent of electric cars. futile attempts to stimulate private demand.
But demand from private buyers is still falling below the expected level needed to meet regulatory targets.
The Zero Emission Vehicle (ZEV) mandate will require 22% of all car sales by major manufacturers to be electric vehicles this year to escape fines of £15,000 per model
New car sales fell 1.9 percent in November, with 153,610 cars on the road
Adoption among private EV buyers has been declining for two years now and demand fell by 3.3 percent in November, meaning less than four in ten (38.1 percent) of new registrations were electric
Adoption among private EV buyers has been declining for two years, with demand falling 3.3 percent in November.
It means that less than two in five (38.1 percent) of new registrations among the general car buying public last month were electric.
Even fleet sales, which represent the largest share (59.9 percent) of the market, fell 1.1 percent to just 91,933 units.
In light of this, the industry now expects the UK EV market share to reach 18.7 percent by 2024, although a strong performance in December could grow to 19 percent – still well below the 22 percent requirement.
And according to the latest industry forecasts, EV registrations will need to grow by a further 53 percent by 2025 if we are to reach the mandatory 28 percent target next year – equivalent to 90,000 additional businesses and consumers making the switch.
New Automotive’s ZEV tracker shows JLR’s parent company Tata and Toyota are the two manufacturers most likely to miss their targets
To meet EV sales, industry voices are calling on the government to “urgently review market regulation and the support needed to govern it,” the SMMT said.
Mike Hawes, CEO, added: ‘Manufacturers are investing at unprecedented levels to bring new zero-emission models to market and are spending billions on attractive offers. Such incentives are not sustainable – the industry cannot deliver Britain’s world-leading ambitions alone.”
Ford’s British boss this week demanded the return of subsidies for electric cars that were scrapped more than two years ago, in June 2022.
Lisa Brankin, the carmaker’s British chairman, said falling demand should be boosted by a “substantial” subsidy, or other financial incentive such as a reduction in VAT on new EV prices.
The government recently met with industry leaders discuss the ZEV mandate and ways to help beleaguered companies meet the strict thresholds put in place this year.
However, many parties do not agree with the government guidelines.
Fleet sales, which represent the largest share (59.9 percent of the market), fell 1.1 percent last month to just 91,933 units
Jon Lawes, managing director at Novuna Vehicle Solutions, expands on widespread criticism of the government’s sales targets, dismissing the ZEV mandate, calling it ‘not fit for purpose’.
“The industry still supports the ambition to increase electric car adoption, but there are two trade-offs that the government can no longer ignore,” he said.
“Policymakers must either revise the quota structure but accept a slower transition, or soften penalties for manufacturers but accept the need for more incentives for adoption.
“The government must quickly complete its review, introduce more fiscal support and end any disconnect with the 2030 ICE (internal combustion engine) phase-out timeline, which will otherwise continue to weigh on the used EV market.”
The ZEV mandate introduced in January sets binding sales targets for electric vehicles that will increase annually over the next decade
There are also concerns that announcements in the autumn budget VED tax increases will dampen demand for electric vehicles for private buyers.
James Hosking, managing director of AA Cars, said: ‘Shifting consumer priorities and wider economic pressures have stalled the recovery, further impacted by the tax increases in the Autumn Budget.
“These include inflation-linked increases in vehicle excise duty (VED) from April 2025 and higher interest rates for the first year, which have dampened buyer sentiment.”
Despite this, the SMMT says that with the right, responsive market regulation, Britain could take a leading position as an exemplary global market for a rapid transition to zero emissions.
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