How will semiconductor shortages impact Government net-zero plans?

Lucy Sherliker, head of customer at Zuto, discusses the lack of second-hand electric cars and how the current semiconductor chip crisis may affect the government’s net-zero plan.

“With last year’s announcement that petrol and diesel cars will no longer be sold in the UK from 2030, along with hybrid cars stopping production by 2035, the sales of electric vehicles have had a dramatic jump, rising by 186% in 2020. How will the climate conference and the current semiconductor chip crisis affect future car sales, and will Brits choose to finance a second-hand car over buying new?

“The UK aims to be the leading G7 country to decarbonise cars and vans thanks to the net-zero plan, and both the government and car manufacturers are working hard to make electric cars more desirable year on year. Manufacturers have guaranteed that an electric car’s battery holds 70% of its original capacity after seven years on the road, creating the opportunity for electric cars to be viable options for those looking to purchase a second-hand vehicle.

“However, the current supply chain crisis around semiconductor chips has caused a dramatic shortage in the manufacturing of cars, with many suppliers shutting down production until further notice. This will then have a knock-on effect of the number of second-hand models on the market as the 2030 deadline approaches. As the second-hand electric car market could take some time to develop, there’s not a great deal of choice currently for consumers who can’t afford a brand new car to do their bit to improve climate change.

“There are also further issues of affordability – although longer term an electric car can be a cheaper option, electric cars from new are probably more expensive than their fuel counterparts.

“The current supply crisis and the demand for second-hand electric cars expected to continue to grow is causing issues for the future of a Net-zero Britain.”