Battery electric vehicles (BEVs) claimed their largest ever UK monthly market share of 32.9% in December 2022, while for 2022 as a whole they comprised 16.6% of registrations, overtaking diesel for the first time to become the second most popular powertrain after petrol.
Together with plug-in hybrids (PHEVs), which experienced a decline of their annual share to 6.3%, all plug-in vehicles accounted for 22.9% of new registrations in 2022 – a record high.
Fleets and business buyers were responsible for the majority of battery electric vehicles, accounting for two thirds (66.7%) of all BEV registrations.
The latest figures from the Society of Motor Manufacturers and Traders (SMMT) also show that pandemic-related global parts shortages were a key factor in overall registrations for the year falling 2.0% to 1.61 million, around 700,000 units below pre-Covid levels. Constrained supply saw many manufacturers prioritise deliveries of the latest zero emission-capable models.
Average new car CO2 fell 6.9% to 111.4g/km in 2022, the lowest in history.
Despite the encouraging increase in the uptake of EVs by businesses and fleets, the SMMT has a number of concerns about support for EVs, particularly for private motorists. Firstly, the government plans to introduce VED on BEVs from 2025 with the same ‘premium’ threshold as internal combustion-engine cars. Cars that cost £40,000 or more (after options) are subject to a £355 annual supplement (up from £335 in 2021/2022) that runs for five years. This starts after the first-year’s CO2-based charge, so drivers will pay the supplement from years two to six of the car’s life.
Higher production costs mean more than half of all BEV registrations this year would have incurred the ‘premium’ VED if it had been in place, a move which the SMMT says risks discouraging wider adoption.
The SMMT also says that chargepoint provision remains a barrier to EV uptake. The government’s EV Infrastructure Strategy forecast that the UK would require between 300,000 and 720,000 chargepoints by 2030. Meeting just the lower number would still require more than 100 new chargers to be installed every single day. The current rate is around 23 per day.
Manufacturers face a Zero Emission Vehicle Mandate from 2024 (the details of which have still not been published). As a result, accelerated investment in charging infrastructure is needed if consumers are to be confident they can make the switch and brands are to have a chance of securing sufficient supply to support UK market growth and not lose out to other markets which are investing more rapidly. Last year, Britain reclaimed its position as Europe’s second largest new car market by volume, both overall and, specifically for plug-in cars. However, as of the end of Q3 2022, it was 13th overall by plug-in market share, behind markets including Norway (78.3%), the Netherlands (28.7%) and Germany (23.5%).
Looking ahead, the SMMT believes that supply chains are beginning to stabilise and although the shortage of semiconductors is expected to ease, erratic supply is likely to impact manufacturing throughout 2023. The most recent market outlook, published in October 2022, anticipates around 1.8 million new car registrations in 2023.