EV incentives needed to convert ‘electric sceptics’ says industry

The UK’s car makers have called for the government to ‘act fast’ to help boost the country’s EV market and convert sceptics to electrification.

Industry body the Society for Motor Manufacturers and Traders (SMMT) said that well-targeted EV incentives could help stimulate more rapid demand for electric cars and attract more than 260,000 extra EV buyers by 2028 over and above those already planning to switch.

According to its research, incentives on new EVs could boost uptake by 15% between now and 2028 and result in more than two million electric cars on the roads.

While a quarter of new car buyers said they planned to buy an EV as their next vehicle, half of those were existing EV drivers seeking to upgrade. SMMT polling found that just one in eight new car buyers intended to switch from ICE electric with their next vehicle. However, it also revealed that two fifths of electric sceptics say they’d change their mind with a purchase incentive.

Among the SMMT’s suggestion is halving the VAT on new EV purchases for three years, which it says would drive the 15% growth in buyers. While this would cost the Treasury an average of around £1,000 per car, the industry body says that in the past five years, the sale of EVs – generally more expensive than petrol cars – has added an extra £2.5 billion in VAT to government coffers.

It argues that such a move, along with more flexible planning regulation and mandated chargepoint roll-out, would help drive ‘a bigger and cleaner new car market’, that would bring down CO2 emissions by six million tonnes a year – equivalent to cutting UK aviation emissions by almost a sixth.

It also says that more electric cars on the roads could stimulate support infrastructure such as chargers and grid connections, helping make the transition to electric vans and HGVs easier too.

SMMT chief executive Mike Hawes said that despite recent years’ growth in supply and demand of electric cars, more still needed to be done to stimulate interest and ensure the industry meets targets laid out in the ZEV mandate.

He commented: “Manufacturer investment has meant ten times as many drivers are going electric compared with just five years ago. This is great progress but, with the right support for consumers, we can go beyond current expectations to put a total of more than two million new EVs on the road by 2028.

“Government investment to convert the ‘electric sceptics’ would energise business across the country far beyond just the automotive sector. Every stakeholder would benefit from the impact of consumer incentives which, when combined with binding targets for chargepoint roll-out and more flexible regulation, would create a virtuous circle of rising demand that stimulates green economic growth.”