In January 2024, the UK marked a significant milestone as the one-millionth battery electric vehicle (BEV) hit the roads, according to the latest data from the Society of Motor Manufacturers and Traders (SMMT).
The first month of the year witnessed a robust growth of 8.2% in the new car market, with 142,876 new car registrations reported. This figure represents an increase of 10,882 units compared to January 2023, making it the strongest January for the UK market since the onset of the pandemic in 2020. January 2024 also marked the 18th consecutive month of growth. The surge in registrations was primarily driven by the fleet market, which saw a significant rise of 29.9%, while private retail uptake experienced a decline of -15.8%. Fleets accounted for over six in 10 (63.2%) of new car registrations, up from just over half (52.7%) the previous year.
Furthermore, the UK reached the anticipated milestone of one million BEV registrations since records began. In January, 20,935 BEVs were registered, reflecting a 21.0% increase year on year. This brings the total number of BEVs registered since 2002 to 1,001,677, underscoring manufacturers’ commitment to delivering an increasing number of zero-emission models. BEV market share for January also saw a year-on-year growth to 14.7%, although it remains below the full 2023 performance of 16.5%. Plug-in hybrids (PHEVs) recorded a volume growth of 31.1%, capturing 8.4% of the market, while hybrid (HEV) volumes saw a slight decline of -1.2% with a 13.1% share.
The SMMT highlights the expected volatility in BEV supply, attributed to manufacturers adjusting product allocation following the resolution of UK-EU rules of origin. This adjustment is crucial in light of potential tariffs on EVs, which could impact affordability. However, despite a 41.7% growth in fleet and business demand for BEVs in January, registrations by private buyers declined by -25.1%, posing a challenge to the UK’s goal of achieving net zero emissions.
The UK stands as the only major market with a 2035 end-of-sale date and a mandated zero-emission vehicle market share, but without significant consumer incentives. The industry calls on the government to support consumers by temporarily halving VAT on new BEV purchases ahead of the upcoming Budget. Such a step, estimated to cost the Treasury an average of £1,125 per car, could accelerate the adoption of electric vehicles and drive economic growth while reducing carbon emissions. Mike Hawes, SMMT Chief Executive, emphasizes the importance of government support to enable consumers to transition to electric vehicles and achieve the goals of net zero emissions.