Future EV ambitions threatened by uncertainty, reports SMMT

Uncertainty over Net Zero regulations is threatening future ambitions in the electric vehicle market, according to the Society of Motor Manufacturers and Traders (SMMT), which has just revealed the latest new car registrations. 

The new car market grew 24.4% in August with 85,657 new vehicles registered, the second year of growth following the pandemic, but still -7.5% below pre-pandemic levels.

The increase was fuelled by a surge in registrations by large fleets, rising 58.4% to 51,951 units, while business registrations grew 39.4% to 1,635 units. Conversely, private demand softened by -8.1%, compared with a supply-constrained 2022 market.

Demand for electrified vehicles continued to grow, accounting for almost four in 10 (37.8%) of new cars reaching the road. Battery electric vehicle uptake achieved a 20.1% market share, the highest recorded since last December. Plug-in hybrid uptake also rose significantly, to account for 7.7% of new registrations. Hybrid volumes remained relatively stable with a 6.8% increase, comprising 10.0% of the market.

However, with less than four months to go until the expected introduction of a Zero Emission Vehicle Mandate, industry still has no sight of the proposed regulation, reported the SMMT, which stressed that the automotive sector is committed to Net Zero but the diminishing time threatens the ability of the market to move.

It said demand from both business and private consumers must be boosted still further if ambitions are to be met, but while businesses benefit from fiscal incentives to switch, there is no similar package for the private consumer market.

Mike Hawes, SMMT chief executive, said: “With the automotive industry beginning a second year of growth, recovery is underway with EVs energising the market. But with a new Zero Emission Vehicle Mandate due to come into force in less than 120 days, manufacturers still await the details. Businesses cannot plan on the basis of consultations, they need certainty. And now, more than ever, government must match action to ambition, ensuring there are the incentives and infrastructure in place to convince drivers to make the switch.”

Jon Lawes, managing director at Novuna Vehicle Solutions, said: “The priority now is for the Government to provide clarity on the ZEV mandate, to avoid stalling investment in charging infrastructure, and mitigate against potential supply issues if manufacturers impose caps on non EVs into the UK which could affect the wider economy, as consumers and the industry grapples with continued uncertainty.

“There is real support for the mandate across the industry, however the challenge is in the detail and with 2024 just around the corner, timing is everything.”