UK Electric Car Demand Skyrockets as New Car Market Declines for First Time in 2 Years.

UK new car registrations experienced a 1.3% decline in August, marking the first drop in 24 months. Despite this overall decrease, demand for electric vehicles (EVs) soared during the month.
Battery electric car demand saw an increase of 10.8% in August, driven by lucrative summer discounts.
Just ahead of the September plate change, the Society of Motor Manufacturers and Traders (SMMT) reported that a total of 84,575 new cars were registered last month. This number indicates a decrease of 1,082 compared to August of the previous year.
Surprisingly, sales to private buyers saw a slight increase of 0.2%, while registrations to larger fleets dropped by 1.2% and ‘Business’ registrations to smaller fleets decreased by 30.3%. However, both small and large fleets still dominated the market, accounting for 62.0% of all cars registered in August.
Although petrol and diesel uptake fell by 10.1% and 7.3% respectively, they still held the majority share of new car registrations at 56.8%. Plug-in hybrid (PHEV) registrations also declined by 12.3%, with a 6.8% market share, while hybrid electric vehicle (HEV) uptake increased by 36.1% to capture 13.8% of the market.
However, the real standout performers were the battery electric vehicles (BEVs) which saw a 10.8% increase in registrations. This surge was primarily due to significant discounts offered by manufacturers and the introduction of new attractive models, resulting in BEVs claiming a 22.6% market share in August.
Year-to-date figures highlight the continued dominance of the fleet sector in the new car market. Larger fleet registrations increased by 19.2% while demand from smaller fleets dropped by 3.3%. Overall, the fleet sector accounted for 62.2% of new car registrations in 2024 so far.
The ongoing increase in BEV market share, which currently stands at 17.2%, is expected to rise further to 18.5% by the end of the year. However, this growth may still fall short of the 22% target mandated for carmakers under the Zero Emission Vehicles (ZEV) regulations.
As the Labour government plans to reinstate the 2030 ban on Internal Combustion Engine (ICE) vehicles, the industry is calling for urgent action to bolster the market for new EVs. This includes the implementation of binding targets on public charge point provision, the reintroduction of incentives for private buyers, and the elimination of disincentives such as the Vehicle Excise Duty expensive car supplement scheduled for 2025.
Mike Hawes, Chief Executive of SMMT, emphasised the need for immediate action to facilitate a mass market shift to EVs, addressing affordability issues and charging infrastructure concerns.
Industry Response
The recent figures have raised concerns regarding the government’s 2030 ICE ban plans and the impact of ZEV mandates on the market.
Jon Lawes, Managing Director at Novuna Vehicle Solutions, stressed the urgency for policymakers to confirm ICE phase-out plans to sustain the momentum in EV sales driven by fleets.
Cox Automotive expressed apprehensions about carmakers rushing to meet ZEV mandate targets, stating that the pressure from the mandate could create an artificial market with long-term consequences.
Various stakeholders in the automotive and fleet sector echoed the need for enhanced support for EVs in the market. Sue Robinson, CEO of the National Franchised Dealers Association (NFDA), highlighted the cost barrier for consumers in adopting EVs and called for price incentives to drive private consumer adoption.
Jamie Hamilton, Automotive Partner at Deloitte, emphasised the importance of expanding superfast charging infrastructure to address consumer concerns and promote the growth of the EV market.
Kim Royds, Mobility Director at Centrica, stressed the necessity of bridging the gap in charging accessibility between homeowners with driveways and those without, calling for collaborative efforts between policymakers and industry leaders to meet the rising demand for electric vehicles.
In conclusion, the dynamics of the car market are evolving, with a notable rise in EV registrations despite an overall decline in new car sales. Stakeholders across the industry are actively advocating for supportive policies and infrastructure to accelerate the adoption of electric vehicles and ensure a sustainable transition towards a greener automotive future.