Demand for electric vehicles falls in first half of 2023
New data from Leasing.com shows that demand from motorists for new electric vehicles fell in the first six-months of 2023.
The share of personal contract hire (PCH) sales enquiries for all electric vehicles (hybrid, plugin and battery) fell from 34.6% in the first-half of 2022 to 22.9% this year. That represented a 33% reduction in personal demand for electric vehicles and the first fall seen by the car leasing comparison website since its records began.
Battery electric vehicles (BEVs) accounted for 9.9% of PCH vehicle enquiries in the first-half of the year, while hybrids and plugin hybrids accounted for 10.3% and 2.7% respectively. The top three most-enquired on electric vehicles by private motorists so far in 2023 were the Tesla Model Y, the Nissan Qashqai and the Hyundai Tucson.
Industry sales data from the Society of Motor Manufacturers and Traders (SMMT) mirrored this trend. In June, 24,953 new EVs were registered to businesses and fleets and 6,747 to private buyers. Year-on-year SMMT data shows that the uptake in EVs continues to rise, but that the pace has slowed.
In response to new car price increases, limited supply of some EVs and general cost-of-living expenses, many motorists continue to turn to ICE vehicles. The share of PCH enquiries for petrol vehicles stood at 58.6% in the first-half of last year, but this increased to 71.1% this year – representing a year-on-year uplift of 21%.
Leasing.com’s 2023 data also revealed that motorists are opting for longer lease terms in an effort to spread their costs as much as possible. The most requested lease term so far this year was 4-years compared to 3-years in 2022.
Paul Harrison, Chief Partnerships Officer at Leasing.com, said: “We first saw a slowing of demand from private motorists for electric vehicles in Q4 2022, when economic conditions deteriorated and inflation spiked. It’s no surprise to see a continuation of that trend this year, the cost-of-living crisis has forced households to evaluate all expenditure, including their choice of vehicle.
The future of the car industry is electric and leasing remains the most cost-effective way for motorists to access their first EV. As an industry we have to help motorists overcome any concerns they have with costs, charging and infrastructure despite the current negative media campaigns.”
Indeed, drivers can save up to £28,900 on the Tesla Model Y compared to buying, and £4,100 compared to a personal contract purchase (PCP) agreement.
