Certainty needed to fully charge EV demand
The latest SMMT data out this week tells a story of two halves. On the one hand it shows a used car market surging ahead, with four million first-half transactions marking a welcome return to pre-pandemic levels. Significantly, one in 10 of those cars were electrified, with zero emission vehicles reaching a record 3.4% share – clear evidence that where there is affordability and choice, consumer demand will follow.
On the other hand, new car demand stalled, with the market posting its weakest July since 2022 and more moderate EV growth compared with the recent trend. This is, however, expected to be a short-term softening, with the market’s sensitivity to external factors heightened by the gap between the announcement of the Electric Car Grant (ECG) and full details of the models that will qualify – a gap which has, inevitably, led to a pause in purchasing decisions.
We must not lose sight of the bigger picture. Year-to-date, the market remains up, with more than a quarter of a million electric cars registered thanks to an expanded choice of models and compelling manufacturer discounts. Our outlook is optimistic, with July’s market forecast revised upwards to 1.9 million units for 2025. EV uptake is also expected to grow, although the anticipated 23.8% market share remains some way off the 28% target, highlighting the importance of full and rapid rollout of the grant.
The light commercial vehicle sector, where the plug-in van grant has recently been extended, proves the effectiveness of fiscal incentives in moving markets, with July’s figures showing an eighth consecutive month of growth in electric van uptake in an otherwise depressed market. Nevertheless, with EV share still little over half of the 16% mandated, action to unlock investment in charging infrastructure and fast-track grid connections is urgently needed.
As we look ahead, the encouraging growth in the emerging used EV sector underlines the necessity of healthy new markets to ensure plentiful supply. It is only by maintaining positive momentum and delivering certainty to both consumers and businesses – through clear supportive fiscal policies and investment in infrastructure – that we will fully realise our zero emission ambitions and deliver a cleaner, greener automotive future for all.