The Society of Motor Manufacturers & Traders (SMMT) is urging the UK government to introduce more incentives to boost the sales of electric vehicles (EVs) among private buyers. Currently, sales of EVs are primarily driven by fleets and companies due to tax benefits, while the retail market lags behind.
According to a new survey commissioned by the SMMT and conducted by Savanta, 68% of non-EV drivers expressed their desire to switch to electric vehicles. However, only 2% of them plan to make the switch this year, with 17% planning to do so in 2024. More than half of the respondents stated that they would not be ready to switch until 2026 or later.
Mike Hawes, the Chief Executive of SMMT, emphasized the need for supply to match demand, especially with the upcoming Zero Emission Vehicle Mandate, which is expected to revolutionize the market in just over 100 days. Hawes stated that a comprehensive package of measures is crucial to encourage households across the UK to adopt EVs, supporting an industry that is slowly recovering from the pandemic while delivering benefits for the economy, society, and the environment.
To achieve this, the SMMT proposes several measures to drive EV sales. These include reducing the value-added tax (VAT) on EV purchases, similar to incentives already provided for solar panels and heat pumps. Additionally, the SMMT suggests raising the threshold for Vehicle Excise Duty (VED) or exempting EVs from it. Lowering the VAT on public charging from 20% to 5%, to match the rate of home charging, is also recommended. Furthermore, the SMMT calls for the introduction of mandated targets for charging point rollout to address the issue of insufficient infrastructure, which currently deters consumers from adopting EVs.
SMMT Electrified, the UK’s leading summit on the transition to zero-emission vehicles, aims to bring together industry leaders, stakeholders, and government representatives to discuss and tackle the challenges and opportunities associated with decarbonizing the transport sector.
1. Society of Motor Manufacturers & Traders (SMMT): A trade association representing the interests of the UK automotive industry.
2. EVs: Electric vehicles powered by electricity, rather than traditional combustion engines.
3. VAT: Value-added tax, a consumption tax charged on most goods and services.
4. VED: Vehicle Excise Duty, an annual tax levied on vehicles in the UK based on factors such as their emissions and list price.
Sources: The Society of Motor Manufacturers & Traders (SMMT)