Automotive Industry Calls for Electric Car Purchase Incentives Amid Decline in Market Share

The automotive industry is facing a challenge as new figures show a decline in the market share of electric vehicles. With only 15.2% of new cars registered in March being pure electrics, down from 16.2% the previous year, the Society of Motor Manufacturers and Traders (SMMT) is calling for urgent action to boost sales.

One of the key proposals from the industry body is to halve VAT on the purchase of new electric vehicles (EVs). This would make electric cars more affordable for consumers and help drive up demand. Additionally, the SMMT is urging the Government to amend plans to introduce vehicle excise duty for EVs and reduce VAT on public EV charging to make it more accessible.

Under the Zero Emission Vehicle (ZEV) mandate, manufacturers are required to ensure that at least 22% of new cars sold in the UK this year are zero-emission. This threshold will increase annually until it reaches 100% by 2035. Manufacturers who fail to comply will face penalties, further highlighting the importance of boosting electric vehicle sales.

Despite the challenges, there is still optimism in the market. Ian Plummer, commercial director at Auto Trader, notes that sales of electric vehicles are still rising, especially in the fleet sector. Manufacturers are also offering attractive discounts to entice customers, with more than three-quarters of new EVs advertised with price reductions.

However, more needs to be done to stimulate demand among private buyers. Alex Buttle, co-founder of Motorway.co.uk, emphasizes the need for greater charging infrastructure and tax incentives to encourage consumers to make the switch to electric. With the arrival of new Chinese entrants in the market, prices are expected to become more competitive, making electric vehicles more accessible to a wider audience.

In conclusion, the automotive industry is calling for government support to boost electric car sales and meet ambitious targets for zero-emission vehicles. By implementing incentives such as reduced VAT and improved charging infrastructure, the transition to electric vehicles can be accelerated, leading to a cleaner and more sustainable future for the automotive industry.