Industry calls for EV retail incentives as fleets drive market growth

The UK caller car marketplace returned to maturation past period arsenic request for electrical cars soared, but the manufacture says the discounting down the uptick is unsustainable and the authorities indispensable bash much to enactment the switch.

The Society of Motor Manufacturers and Traders (SMMT) notes that it was the champion May for caller car registrations since 2021 but inactive 18.9% down connected the aforesaid period successful pre-pandemic 2019. It is besides lone the 2nd period of maturation truthful acold successful 2025, "reflecting brittle user assurance and economical turbulence".

The organisation attributed the uptick chiefly to a surge successful fleet registrations, which climbed 3.7% twelvemonth connected twelvemonth to conscionable implicit 90,000, accounting for a 60% marketplace share.

Private car sales, meanwhile, were down 2.3% and accounted for 37.4% of the marketplace - and portion concern registrations grew by a important 14.4%, they inactive made up lone 2.6% of registrations.

It was different period of maturation for electric cars, with astir 33,000 units registered – a 25.8% yearly summation – accounting for 21.8% of the market. That's inactive acold beneath the 28% EV income premix that manufacturers indispensable execute this twelvemonth nether the ZEV mandate, but good supra the 13.6% and 11.9% shares held by hybrids and plug-in hybrids respectively.

The SMMT says the emergence in EV registrations comes disconnected the backmost of the "attractive incentives" manufacturers are offering successful a bid to thrust uptake, though the organisation repeated its telephone for the authorities to "match this committedness with fiscal incentives".

Halving VAT connected caller EV purchases, the SMMT says, would enactment 276,000 caller EVs connected the roadworthy successful the adjacent 3 years, successful spot of ICE vehicles, resulting successful an yearly simplification successful CO2 emissions of six cardinal tonnes. 

It besides said the authorities could "send a awesome that present is the clip to switch" to EVs by reducing the VAT connected nationalist charging and removing electrical cars from the Expensive Car Supplement (ECS) - a determination the authorities is understood to beryllium considering already. 

While EV income were up, diesel's decline continued with a immense 15.5% driblet successful registrations past month, taking oil-burners to conscionable a 5.2% marketplace share. And portion petrol cars inactive marque up astir fractional of registrations, their income were down a dense 12.5%. 

SMMT main enforcement Mike Hawes said: "A instrumentality to maturation for caller car registrations successful May is invited but shaper discounting connected caller products continues to underpin the market, notably for electrical vehicles. 

"This cannot beryllium sustained indefinitely arsenic it undermines the quality of companies to put successful caller merchandise improvement – investments which are integral to the decarbonisation of each roadworthy transport. 

"Next week’s Spending Review is the accidental for authorities to treble down connected its commitments to nett zero by driving request done fiscal measures that boost the marketplace and enactment up our competitiveness."