VM electric vehicle discounts to reach £2bn this year

Vehicle manufacturers are on course to spend about £2bn on electric vehicle discounts this year, according to the Society of Motor Manufacturers and Traders.

This comes as they struggle to meet ZEV Mandate targets amidst falling customer demand.

The SMMT has reported that EV sales are down 6.3% to date this year.

However, the discounts appear to be working with SMMT figures from September revealing that EV sales hit a new volume record for the month, up 24.4% to 56,387 units to achieve a 20.5% share of the overall market.

Electric vehicle discounts

Fleets drove much of this growth, with deliveries rising 36.8% to account for more than three quarters (75.9%) of registrations. Private EV demand rose only 3.6%, or 410 additional registrations.

Meanwhile, the overall new car market was up one per cent in September to 275,239 units.

Fleet purchases were up 3.7% to 149,095 units, representing 54.2% of the overall market, while private consumer demand fell by 1.8% to 120,272 units, accounting for 43.7% of registrations.

Uptake of plug-in hybrids (PHEV) grew faster than any other fuel type, up 32.1% to take an 8.9% share of the market. Hybrid electric vehicle (HEV) registrations rose 2.6%, boosting market share to 14.2%, while petrol and diesel registrations declined by 9.3% and 7.1% respectively.

Mike Hawes, SMMT Chief Executive, said:

“September’s record EV performance is good news, but look under the bonnet and there are serious concerns as the market is not growing quickly enough to meet mandated targets. Despite manufacturers spending billions on both product and market support – support that the industry cannot sustain indefinitely – market weakness is putting environmental ambitions at risk and jeopardising future investment.

“While we appreciate the pressures on the public purse, the Chancellor must use the forthcoming Budget to introduce bold measures on consumer support and infrastructure to get the transition back on track, and with it the economic growth and environmental benefits we all crave.”