The Chief Executive of the Society of Motor Manufacturers & Traders (SMMT) has said that workable regulation is needed if the UK wants to become a global exemplar market for a rapid, successful EV transition.
In his latest CEO update on Friday, Mike Hawes said:
As the countdown to year end gets underway, the latest market figures from SMMT paint a mixed picture. While electric car registrations grew for an eleventh straight month making up a mandate-beating quarter of the market, the overall market contracted for the third time in four months. Even as the industry races to meet targets, investing eye-watering sums to do so, there remains a shortfall across the year, with the latest industry outlook expecting zero emission vehicles to represent just 18.7% of the market in 2024.
Manufacturers have already invested billions to transform their product lineups, factories and workforces to net zero, and now offer more than 130 different EV models to UK consumers. It’s for these reasons that industry welcomes government’s pledge to fast-track a review of the market, regulation and support. Not because we want to water down any commitments but because delivery matters, more than notional targets, when long-term investment, viability and jobs are at risk.
The feasibility of delivering the mandate amid lower than anticipated EV demand is also compromised in the UK’s new van market where, while electric uptake rose in November, the EV market share has in fact reversed across 2024, from 5.9% to 5.8%. The sector remains some distance off meeting its 10% target for the year, which rises to 16% in 2025. The current Plug-in Van Grant has been extended into the next financial year, but a lack of van-suitable charging infrastructure continues to undermine fleet operator confidence across the UK.
Delivery looks more challenging now than when the mandate was conceived and, indeed, introduced by the previous government, as global challenges mean the expected fall in the cost of production and therefore buying, an EV have not come to pass. Consumer uptake has not risen to the levels needed, with fleets dominating demand via benefits such as salary sacrifice and Benefit in Kind. Furthermore, the absence of any UK plan for consumer incentives, cheaper energy and infrastructure rollout makes future demand harder to forecast. If we could deliver those plans, however, as part of an ambitious industrial strategy, the UK could still be a global exemplar market for a rapid, successful transition – one that can deliver £50bn in green growth in the next decade.
We already have the second largest EV market in Europe by volume, and we’re closing the gap with leader Germany – but sustaining that success in 2025 will be challenging. Car makers must deliver a zero emission market share of 28% next year, but only with a bold plan for the markets, and a strategy for industry, can we expect growth at the scale needed.
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