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'Green' cars see sales growth across the board as petrol and diesel continue to struggle

As Coronavirus restrictions ease across the United Kingdom, sales of electric and plug-in hybrid cars have sprung back into positive growth. With petrol and diesel still struggling to get close to pre-lockdown sales volumes, is now the time when EVs really begin to take off?

Car dealerships in England opened up on the first of June after almost three months of lockdown, during which time retailers could only fulfil orders or sell cars online. The grand reopening didn't exactly result in a rush; overall car sales for the month were down 34.9 per cent compared to 2019, demonstrating the continuing uncertainty in the market and also the fact that dealerships in Wales and Scotland reopened on June 22 and 29 respectively.

However, when it came to EVs, PHEVs and other electrified cars, it was a different story. Figures from the SMMT showed that alternatively fuelled vehicles (including EVs, PHEVs, hybrids and mild hybrids) accounted for almost a quarter of new car registrations (23.7 per cent) and crucially, all types grew when compared to 2019.

Looking at EVs specifically, 8903 were sold during June compared to 2461 in June 2019 – an increase of 261.8 per cent. They claimed 6.1 per cent of the total market compared to just 1.1 per cent last year. For the year to date the story is similarly positive with EVs taking 4.7 per cent of the entire new car market with 30,957 cars registered – which is still on course to be a significant jump on 2019. Once again the Tesla Model 3 proved to be the star of the show with 2517 sold, coming 9th overall in the best sellers list.

After an initial dip in popularity following the removal of the plug-in car grant, PHEVs have bounced back into relatively strong, positive, post-lockdown growth. In June, 4926 PHEVs were sold – more than double the number in June 2019, and representing 3.4 per cent of total month sales. For the year-to-date, PHEVs are up 28.9 per cent and account for three per cent of the market.

Mike Hawes, Chief Executive of the SMMT, acknowledged the positive news, but called on the Government to do more: “While it’s welcome to see demand rise above the rock-bottom levels we saw during lockdown, this is not a recovery and barely a restart. Many of June’s registrations could be attributed to customers finally being able to collect their pre-pandemic orders, and appetite for significant spending remains questionable.

“The government must boost the economy, help customers feel safer in their jobs and in their spending and give businesses the confidence to invest in their fleets. Otherwise it runs the risk of losing billions more in revenue from this critical sector at a time when the public purse needs it more than ever.”

Post-Coronavirus surge?

There are three main factors in play when it comes to a post-coronavirus boom in EVs: Government stimulus, manufacturer focus and consumer demand.

Globally, governments are pushing for electrification, and whilst so far the UK government has stopped short of announcing a new green car scrappage scheme, it is investing heavily in electrification. Advisory bodies like the Committee on Climate Change are recommending more incentives for zero emissions-capable cars and the penalising of ICE, so the pendulum is beginning to swing more in favour of EVs.

Manufacturers are in a bit of a catch 22; they have lost billions and ICE vehicles are their cash cows, but they can't let their EV focus slip as EU emissions rules would be even more crippling in the long-run. Many have tooled – or are tooling up – to produce EVs and their businesses depend on their success. VW has already produced ID.3s in large numbers and is simply waiting to ship them to market. Other manufacturers have significantly increased their EV production capability, too.

Finally, consumer demand is increasing as EVs become more mainstream. Whilst we tend to steer clear of consumer surveys as the data often isn't particularly reliable, the general consensus is that a significant proportion of car buyers are considering an EV as their next car at the minimum. With prices becoming more attainable – especially with the plug-in car grant taken into account – and infrastructure getting better, the barriers to adoption are falling. There's also the realisation during lockdown that cleaner air, fewer car journeys and a more sensible approach to vehicle use is actually quite pleasant, so some will have been nudged into buying an EV as a direct result of coronavirus.

These factors mean that despite several months of interruption, EVs will still likely hit the whole year predictions for 2020, made long before the impact of coronavirus could have been known.

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