Electric Vehicle sales forecasts – 1 million EVs in the UK by 2020?

There may be 1 million Electric Vehicles (EVs) on UK roads by 2020
; read our 7 reasons why electric vehicle sales are likely to grow to this level from their current low numbers in the UK.

To put this into context, just over 1000 electric vehicles were purchased in the UK in 2011 through the government’s Plug-in Car Grant.

EV sales forecasts

There are lots of EV sales forecasts in existence in various reports yet there is no industry consensus on the numbers of EVs by 2020. We’re not expecting it to be easy to predict the exact number of EV sales in the UK in eight years’ time, but the different forecasts have a massive range from around 100,000 to 1.5 million.

Starting with the Committee on Climate Change, it foresees the market for EVs and plug-in hybrids will have to reach 16% by 2020 in order to achieve the UK’s targets.

The UK DfT scenario for 2020 is for 1.2 million EVs to be on the road, and 350,000 PHEVs – so around 1.5 million in total.

Other forecasts for the numbers of electric vehicles by 2020 are significantly lowe r. The European Automobile Manufacturers’ Association (ACEA) says 3-10%, LMC Automotive predicts 8%, and Morgan Stanley reckons that, globally, there will only be 4.5% battery EVs by 2025 .

The Institute of Economic Affairs (IEA) predicts 1.1 million EV and Plug-in Hybrid (PHEV) sales globally by 2015, 6.9 million by 2020, and 106 million by 2050.

Taking an average of the above, around 10% of new cars in the UK to be plug-in vehicles by 2020 seems like a reasonable maximum. The total UK new car market each year is approximately 2 million cars – so this would equate to around 200,000 EVs (all types) sold in 2020. Add this to the number of EVs already on the road between now and 2020 – so we’re back towards the 1 million figure again for total EVs on the road by the end of 2020 – ie. in 8 years time. The minimum figure is likely to be 250,000 EVs by that stage.

7 reasons why electric vehicle sales will soon grow from their current low numbers in the UK

1. The UK government needs to reduce CO2 from cars

The UK has stated an ambitious target of an 80% reduction in CO2 by 2050 compared to 1990 baseline levels. Road transport is an important element of this, and the King Review in 2007/8 provided recommendations to government about how to achieve such reductions through government measures including the measures such as the Budget, for instance through road tax, company car tax, plug-in car incentives and initiatives etc. So far government policy has acted upon the recommendations to incentivise the take-up of ultra-low carbon cars. Such incentives may slow down but it’s unlikely to stop.

2. The car manufacturers have to reduce CO2 from cars

Recently the EU has confirmed that all car manufacturers in Europe must aim for a fleet average target of 95g/km CO2 by 2020. The only way that most manufacturers will achieve that is through their vehicles having plug-in capability; either full EVs, Extended-Range Electric Vehicles (E-REV) or Plug-in Hybrid Electric Vehicles (PHEV). Virtually all major manufacturers are now investing heavily in vehicles with plug-in technology. It’s highly unlikely that they would do that if they didn’t see a market for them.

3. Certain areas, such as most London boroughs, have to reduce the regulated emissions from vehicles

Most London boroughs are heading for large fines from Europe due to not complying with air quality targets (for regulated rather than CO2 emissions, ie. particulates, NOx etc). It will be cheaper for such places to encourage electric vehicles rather than pay the fines.

4. The London Congestion Charge is soon likely to change with the outcome of encouraging more EVs in the capital

Sub-100g/km CO2 cars are currently exempt from the London Congestion Charge – this will soon be reviewed, and whether the outcome is a new lower 75 or 80g limit or whether it’s back to a technology-based system, it’s 99.9% likely that the outcome will be that the new system will encourage electric vehicles more than the current system does.

5. The Automotive Council Technology Road Map shows electric cars as a mainstream technology by 2020

The Automotive Council Technology Road Map is the official consensus between manufacturers and industry organisations about vehicle technologies over the next 40 years. It shows that electric cars will be a mainstream car technology before 2020, with an increasing take-up rate as from now.

6. Motorists want low car running costs – electric vehicles provide this

Motorists want low car running costs. Electric vehicles provide this. The problem at the moment is that EVs are expensive in relation to their driving range capability. However the Renault Zoe will be launched in early 2013 and will cost around half of most current mainstream EVs (£13,650 plus £70/month battery rental). It will also have a range of 130 miles. Factor in the ever-increasing price of oil, and likely spikes due to eg. unrest in the Middle East/natural disasters etc, and EVs will become more and more attractive to the average motorist.

7. Example of the Toyota Prius

When the ‘Mark I’ Toyota Prius hybrid appeared it was seen as an oddball car for eco-warriors. It’s now the world’s best-selling car. EVs are likely to follow this pattern.

So in summary, electric vehicle uptake in the UK to date has been slow . This is primarily due to a small range of electric vehicles being available, and the ones that are available have a limited capability in terms of driving range and long recharge times, compared to petrol and diesel cars with a much cheaper purchase price. However as the evidence above suggests, over the next few years there is likely to be a significant growth in plug-in vehicles.

Of course, electric vehicles will only be truly low carbon if UK electricity generation becomes low carbon. And if electric vehicles grow in numbers to the rates forecasted by 2050, the UK will be highly reliant on electricity as a power source for our homes, our businesses and our vehicles. Only if there is a massive increase in UK-produced renewable energy by that stage will the country have any hope of energy security.

Paul Clarke