TLDR:
- Electric vehicle (EV) demand in the UK is flatlining despite a nearly 18% increase in new car registrations last year, prompting calls for a VAT cut on all new EV purchases.
- Annual figures released by the Society of Motor Manufacturers and Traders (SMMT) show that while 315,000 new battery electric vehicles were sold in 2023, they represented just 16.5% of total registrations.
- The SMMT is calling for the government to halve VAT on all new zero-emission vehicles (ZEVs) purchases across the next three years, a move that it estimates would save consumers £7.7bn and increase the number of ZEVs on the road by 250,000 by 2026.
The UK automotive industry is calling on the government to halve the value-added tax (VAT) on all new electric vehicle (EV) purchases, as demand for EVs in the country remains stagnant. The Society of Motor Manufacturers and Traders (SMMT) released annual figures that show a 16.5% share of battery-electric vehicles (BEVs) in new car registrations in 2023, slightly down from the previous year. Despite a government goal to transition away from petrol, diesel, and hybrid vehicles by 2035, EV sales are not meeting expectations. The SMMT is urging a VAT cut on all new zero-emission vehicle (ZEV) purchases for the next three years, which could save consumers £7.7bn and put 250,000 more ZEVs on the road by 2026. The industry believes this incentive would help reinvigorate EV sales and make the UK the leading European market for ZEVs.
