Newly released data by the Society of Motor Manufacturers and Traders (SMMT) has shown battery electric vehicle (BEV) uptake reached a record volume in 2023.
According to the organisation, BEV uptake was up by almost 50,000 units with 314,687 new registrations throughout 2023. Indeed, 2023 saw more BEVs reach the road than in 2020 and 2021 combined.
With this in mind, BEVs accounted for one in six new cars registered on UK roads in 2023 with SMMT having stated that the majority was taken by business and fleet buyers who benefit from compelling tax incentives. In contrast, one in 11 private buyers chose a BEV.
As seen in the graph above, March 2023 saw a huge surge in BEV registrations amounting to 46,626. This was hotly followed by September 2023 which saw 45,323 BEV registrations.
However, it must be stated that BEV volumes fell by 34.2% year-on-year in December 2023. SMMT was quick to note that this is a reflection of an abnormal December 2022 when significant numbers of orders were able to be fulfilled in the month.
Turning our attention to 2024, the landscape for EV adoption begins to become clouded. This is due to various political uncertainties, particularly with the implementation of the zero emission vehicle (ZEV) mandate which came into force in early January, as reported by Current±.
In September 2023, this legislation fell under controversy as Prime Minister Rishi Sunak proposed a delay to the mandate, moving the deadline for a 100% ban on internal combustion engine vehicles (ICEs) from 2030 to 2035. Final legislation now dictates 80% of new cars and 70% of new vans sold in Great Britain will be zero emission by 2030, increasing to 100% by 2035.
As a result, drivers may feel inclined to wait further into the decade before buying an EV, particularly with the government also missing its 2023 goal for EV charging infrastructure at motorway service stations.
Another aspect that may hinder the adoption rate for EVs that SMMT was keen to highlight, was the “last-minute deal” on UK-EU Rules of Origin, which avoids tariffs on EVs but has “made planning difficult”.
It is worth noting that SMMT predicts 2024’s new car market to reach 1.97 million units, with 439,000 BEVs taking a 22.3% market share.
Industry calls for VAT to be halved for BEV buyers
With fears that EV adoption could lose momentum in 2024, the EV industry is now calling on the government to support private buyers by halving VAT on new BEVs for three years.
SMMT explained that this temporary cut would “give private consumers access to fiscal support at a level similar to that enjoyed by business buyers, enabling manufacturers to deliver larger volumes of zero emission vehicles”.
Coupled with the fiscal support which has seen adoption rates surge for businesses, this could well catapult the UK EV industry into a new golden age.
This could also have an implication on the rollout of EV chargepoints with firms seeing more investment incentives to develop a rapidly evolving market.
Mike Hawes, SMMT chief executive, said: “With vehicle supply challenges fading, the new car market is building back with the best year since the pandemic. Energised by fleet investment, particularly in the latest EVs, the challenge for 2024 is to deliver a green recovery.
“Government has challenged the UK automotive sector with the world’s boldest transition timeline and is investing to ensure we are a major maker of electric vehicles. It must now help all drivers buy into this future, with consumer incentives that will make the UK the leading European market for ZEVs.”