auto market

UK electric car sales surge despite bleak period for car market, figures show

More than one in ten new cars sold in the UK are now battery or hybrid vehicles

More than one in ten new cars sold in the UK are now battery or hybrid vehicles

Pure electric vehicle sales are up 664 per cent since 2016 while diesel sales are down 75 per cent through the same period, according to SMMT

Electric vehicle sales have surged in the wake of Covid-19 in the UK, with the latest industry figures for September 2020 showing battery cars continuing their forward march, despite a sharp downward trend for the wider auto market marked by waning petrol and diesel sales.

Sales of battery EVs were three times higher last month compared to September 2019, the latest data from the Society of Motor Manufacturers and Traders (SMMT) shows, and ten per cent of all new cars sold now come with a plug for electric charging, meaning they are either fully electric or plug-in hybrids.

Demand for battery EVs increased by 184 per cent compared with September last year, with the month accounting for a third of all 2020’s battery car sales, the data shows.

With non-plug hybrids now accounting for 21 per cent of sales, only around two-thirds of new car sales are conventional petrol or diesel – down from 98 per cent just five years ago. Diesel cars in particular have seen a sharp decline, falling from around 50 per cent of car sales in 2015 to just 14 per cent this September.

Overall, pure EV sales are up a whopping 664 per cent since 2016, while diesel sales have plummeted 75 per cent over the same period, today’s data from the trade association shows.

“Even with this growth, however, meeting accelerated ambitions for uptake of these vehicles will require government to get behind a truly world-class package of incentives – alongside binding targets on infrastructure to reassure consumers that recharging will be as easy as re-filling,” SMMT said of the EV sales figures.

The expanding market share of EVs comes amid steep declines in overall car sales, however, which are down 40 per cent from a peak in 2017. According to SMMT analysis, last month was the weakest September for car sales in over 20 years, marking “one of the bleakest periods in the sector’s history”, it said. New car sales fell 4.4 per cent on the previous year, sinking to a level 15.8 per cent below the ten-year average for the month.

As such, SMMT chief executive Mike Hawes bemoaned a “torried year” for the automotive sector, but praised its “incredible resilience”. “Unless the pandemic is controlled and economy-wide consumer and business confidence rebuilt, the short-term future looks very challenging indeed,” he said.

It follows separate analysis yesterday from Transport & Environment (T&E) highlighting the huge potential for company car sales to accelerate the shift to electric vehicles, leading the campaign group to call on governments in the UK and Europe to reform subsidies on company cars that currently support the use of fossil fuel vehicles.

As many as six out of ten cars sold in Europe and the UK are company cars, T&E said, yet nearly all of them – 96 per cent – are petrol or diesel vehicles. As such, these corporate fleets receive a raft of fiscal benefits including benefit-in-kind taxation, VAT returns and depreciation write-offs, according to the campaign group.

As a result, it calculates that European and UK taxpayers fund €32bn in subsidies for company cars, nearly all of which is spent on polluting petrol and diesel engines that are fuelling the climate crisis.

Instead, T&E urged governments to end the VAT deductions and write-offs for fossil fuel vehicles and instead use tax incentives to guide corporate fleets towards 100 per cent emissions-free vehicles, which it argues would help cut running costs for EVs, helping to save companies as much as “€4,300 per vehicle on average”.

“Electric cars are already the best choice for corporate fleets which clock up high mileage and care about overall costs, not sticker price, yet most company cars have polluting engines,” said Saul Lopez, e-mobility manager at Transport & Environment. “Why should taxpayers effectively subsidise the pollution of company cars when electrics are cheaper to use? Governments, the EU and cities should pick this low-hanging fruit so that all new company cars are electric by 2025.”

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