EV registrations have surged by a record 44.5% in July – these are the reasons Brits are choosing to make the switch from petrol to electric cars.
Britain’s new car market grew 11.7% in July with 156,571 units registered, according to the latest figures published today by the Society of Motor Manufacturers and Traders (SMMT). The performance marks an eighth consecutive month of growth.
Growth was driven by electrified vehicle uptake, with plug-in hybrids up 33.6% to take a 14.9% share of the market, and hybrids up 11.6% to account for 13.2%. Electric cars (EVs) achieved another record volume for the month, up 44.5% to claim a 27.5% share.
The latest industry outlook now expects EVs to reach 27.4% of a 2.18 million-strong market by year end – up from a 26.8% share in April’s outlook but still far short of the 33% mandate target.
Longer term, EV share is expected to rise to 32.1% in 2027 against a target of 38%. This is despite an ever-expanding number of brands and models, manufacturer subsidies, government incentives and an ongoing backdrop of high fuel prices.
Growth
James Hosking, Managing Director of AA Cars, said EVs have opened up to more buyers due to the Electric Car Grant and 0% interest finance deals.
He added: “Electric vehicles continue to play a central role in the market’s growth, with EV registrations rising 44.5% in July. Greater model choice, increasingly competitive pricing, heavy discounting and government incentives are encouraging more drivers to consider making the switch, although demand will still depend on confidence around charging, upfront costs and the direction of government policy.
“The Electric Car Grant, as well as 0% interest finance deals from new brands entering the UK, have opened up EVs to more buyers.
“Continued growth in new car registrations should also support the used market. As more motorists change their vehicles, additional part-exchanges will return to dealer forecourts, improving the supply of younger used cars that has remained constrained in recent years.
“That should give second-hand buyers more choice, but value will remain critical. Consumers are comparing models, fuel types and total ownership costs more carefully, so dealers will need to price competitively and give buyers confidence that the vehicle represents good long-term value.”
Paul Denley, CEO at London-based Oakham Wealth Management, said there are numerous reasons more people are choosing EVs.
He added: “The Electric Car Grant has likely helped, but it’s only one factor. Cheaper finance, a wider choice of models and lower running costs are making EVs a more rational purchase, while affordability and charging access remain the biggest constraints.
“EVs are quieter, cheaper to run and simpler to maintain than petrol or diesel cars, although for many drivers the trade-off is charging convenience and range on longer journeys. A healthy car market matters because it supports manufacturing, dealerships, finance, insurance and thousands of skilled jobs. Car sales are also a useful barometer of household confidence and wider economic activity.”
Tax savings
Samuel Mather-Holgate, Managing Director & IFA at Swindon-based Mather and Murray Financial, said the rising cost of oil is leading to people moving to EVs.
He added: “The grant may have helped at the margins, but the bigger force here is the cost of fuel. Drivers are not suddenly becoming policy wonks, they are looking at petrol and diesel prices and doing the maths. Once an EV fits the budget, the appeal is obvious: lower running costs, less exposure to volatile pump prices and a smoother everyday drive.
“The car market matters hugely to the UK economy because it touches manufacturing, retail, finance, insurance, maintenance and household confidence. Strong registrations suggest consumers are still willing to make big-ticket purchases, but the real test is whether EV demand can keep growing without relying on discounts and subsidies. For many households, this is less about a government grant and more about escaping the tyranny of the forecourt.”
Scott Gallacher, Director at Leicester-based Rowley Turton, said he drives an EV because of the tax savings.
He added: “I have a BMW i5 as a company car. It’s a great car, but the main reason for me having an EV is the company car tax savings compared to a diesel or petrol car.”
