Marking the start of SMMT Electrified, the UK’s leading summit on the zero emission vehicle transition, the Society of Motor Manufacturers and Traders have called for more government action to enable and encourage private ownership of EVs
While electric vehicle sales in the UK are the second highest in Europe, this is now being primarily driven by fleet and business buyers.
The Plug-in Car Grant ended over year ago, meaning that the UK is the only major European market with no incentives for private drivers to switch to emission free motoring. Since the grant ended, sales to private buyers have fallen from more than one in three, to less than one in four. By contrast, business demand continues to be driven by financial incentives.
New research shows that two thirds of British ICE car drivers are keen to switch to an EV but only 2% see themselves doing that this year, and just 17% next year. 68% said they would by sooner if financial incentives were in place for them to do so.
The SMMT say that the success of the business and fleet markets needs to be replicated in the private sector, arguing that the incentives already offered by the manufacturers need to be complemented by government-backed initiatives.
They point out that a reduction in VAT on EV purchases would mirror existing discounts on other environmental products such as solar panels and heat pumps. Raising the threshold for the Vehicle Excise Duty ‘expensive car supplement’ from its 2017 level to reflect today’s costs – or exempting EVs altogether – would also help. Taxation would also be fairer if VAT on public charging matched home charging at 5%, not 20%.
Mike Hawes, SMMT Chief Executive, said: ‘We are entering a new phase in the UK’s EV transition, in which Britain can, and should, be a leader. We have the industry, the love of new technology and the scale to succeed. Government has recently demonstrated its commitment to EV manufacturing in the UK and that commitment must be extended to the consumer. With a new – and still to be finalised – Zero Emission Vehicle Mandate due to revolutionise the market in just over 100 days, supply must be matched by demand. A comprehensive package of measures would encourage households across the UK to go electric now, boosting an industry slowly recovering from the pandemic and delivering benefits for the Exchequer, society and the global environment.’