Despite strong sales of electric vehicles (EVs) reported by the Society of Motor Manufacturers and Traders (SMMT) recently, Cox Automotive warns that more needs to be done to encourage consumers to buy electric vehicles ahead of the target to ban the sale of new internal combustion engine (ICE) cars by 2030.
SMMT data for June 2020 showed the Tesla Model 3 was the UK's overall bestselling vehicle (of any powertrain) in the month, with 5,468 units sold. However, this is against the backdrop of an automotive market that stood at just 186,000 units sold, down almost 16% from seasonal norms. According to Cox Automotive, while progress towards the adoption of EVs is improving, more must be done if manufacturers and dealerships are to meet clean air targets.
Philip Nothard, Insight and Strategy Director at Cox Automotive, said: "While the EV segment is undoubtedly growing fast, this is against an overall reduction in new vehicle sales. Some major barriers still stand in the way of mass EV purchasing, including range anxieties and concerns around the high cost of new EVs. Many motorists still need more convincing to go electric, along with better financial incentives and information, if we are going to be ready for the switch to electric new vehicles by 2030."
A recent consumer survey by automotive data specialists firm Regit, in partnership with Cox Automotive, found that more than half (56%) of drivers would consider an EV for their next vehicle purchase. This is backed up by data from Auto Trader showing that there is an increased demand for electric vehicles across both new and used vehicles.
EV share of daily ad views on Auto Trader
However, the survey also revealed that a worrying 92% raised concerns about the current charging infrastructure and the cost of new EVs (72%).
Similar challenges also exist in the used vehicle market. Regit and Cox Automotive's survey also revealed that only 45% of drivers would consider buying a used electric vehicle. New EVs are more attractive to consumers than nearly new models due to the incentives. These include Personal Contract Purchase (PCP) plans that include manufacturer deposits and the government's 'plug-in car grant' (PiCG), often making ownership costs lower than buying a nearly new used EV.
Chris Green, Regit Chief Commercial Officer and founder said: "UK motorists are becoming increasingly aware of EVs and their benefits. The fact more are considering them as their next car purchase shows a shift in attitude and awareness. However, there is more work to be done to convert consumers from considerers to purchasers, whether it be from the manufacturer, motor traders or the UK government."
Consumer attitudes are showing signs of change. Regit found that 79% of consumers consider emissions an important factor in their choice of new vehicle, while 64% welcome the introduction of clean air zones. Nothard believes that the current sustainability movement if backed by the right government incentives and supported by more information about EVs by dealerships and manufacturers, could accelerate EV purchases and make a difference when it comes to phasing out new ICE sales.
Nothard said: "Following cuts to the Plug-in Car Grant and Van & Truck Grant (PiCG), combined with the higher upfront cost of EVs and lack of new vehicle supply, motorists are likely to stick with cars that are powered by internal combustion engines because they are cheaper and easier to run.
"Regit found that a little over half of consumers believe they do not have sufficient information to make the switch to an electric vehicle, while two-thirds are unaware of any incentives to switch to EV. Dealers can play a crucial role during this transition for the new and increasing used EV market, especially in terms of informing their customers and helping them find the vehicle that suits their needs and driving habits. Affordable and accessible EVs are available on the used market and could provide the use case required to convert even more new EV sales."
Jon Davies, Brand Partnerships & EV Strategy Director at Auto Trader UK concurs: "To support electric vehicle uptake, we believe we need to see greater incentives, investment and information from the government. Greater incentives to deal with the prohibitive up-front cost for many consumers and lack of consumer choice, both on new cars but crucially also on younger used vehicles. More investment to get over the infrastructure barrier. Perception of infrastructure issues is one of the top two barriers (after cost) listed by consumers. Lastly, we believe we need to see more information to make this new industry understandable to all. 40% of consumers, we asked don't know government grants are even available, let alone understanding the different charging speeds."
EVs make small contribution to national car parc
Nothard offers insight for the automotive sector and an overview of the H1 new vehicle performance and forecasts for quarter three and the financial year in the second issue of AutoFocus, the new quarterly insight report, released on 20th July. Writing in the latest issue, he discusses how well dealers have performed since their full reopening in April, following the loosening of government restrictions. Recent figures of EV sales published by the SMMT support Nothard's view. Battery (BEV) and plug-in hybrid electric vehicles (PHEVs) achieved a 21.7% market share in June 2021, overtaking diesel vehicles at 18% which are continuing to fall out of favour with UK motorists.
However, the overall number of electric vehicles on UK roads is still low when compared to the entire national car parc. AutoFocus publishes data from Auto Trader, who suggest that by 2025, EVs will make up 9% of the car parc and alternatively fueled vehicles (including EV) will make up 18% of all vehicles on the road. At present, EVs still represent only 1% of the UK car parc and AFVs represent 3%.
Davies added: "Consumers are becoming increasingly aware of the benefits of EVs as more join the roads every year. EVs emit fewer emissions, project a better image of private car ownership, are enjoyable to drive and require less frequent maintenance. Auto Trader is the platform where motorists can discover more choice in both new and used EVs, from saloons to SUVs. The market for electric cars is in the best shape it's ever been, and they are increasingly more affordable as a result."
Nothard concluded: "As a nation, we are clearly making progress on taking the case for electric vehicles to the consumer. Although recent initiatives such as the introduction of clean air zones are making people think twice about their vehicle's effect on the environment, there is still more work to do to move motorists from consideration to purchase. Only then can we confidently predict that the automotive industry will reach its 2030 decarbonisation goals."