Currently reading: UK could lose EV lead in Europe with new car tax brackets
Britain bought the most alternatively fuelled cars in Europe last year, but the SMMT says new VED brackets could hinder growth
Sam Sheehan
News
2 mins read
23 February 2017

The UK’s role as Europe's biggest market for plug-in electric cars could be under threat when new VED brackets are introduced in April.

Britons bought 36,917 alternatively fuelled models last year, with the segment now representing 4.2% of the country’s overall registrations. But rising tax costs that’ll affect the majority of alternatively fuelled vehicles could deter potential buyers from opting for zero-emission models.

Strong UK car market growth spurred on by alternatively fuelled vehicles

The government’s new car tax brackets will move 66% of the available alternatively fuelled vehicles from road tax exemption to being subject to a £130 flat rate annual fee. A YouGov survey commissioned by the Society of Motor Manufacturers and Traders found that low running costs were the biggest draw for 51% of motorists, revealing how much of a hit the impending tax hike could have on demand for hybrids and EVs.

According to the survey, just 13% of British motorists are considering an alternatively fuelled car for their next vehicle.

To raise awareness of Britain’s leading position in electric cars and show support for low-emission transport, the UK automotive industry organised a display near London’s Tower Bridge, with 26 electric vehicles from 16 different brands featured.

Models ranged from the BMW i8 hybrid sports car to the two-seater Renault Twizy city car. The group represents less than one third of the available alternatively fuelled vehicles on sale in Britain, with the total currently amounting to 83 models.

SMMT chief executive Mike Hawes said: “Thanks to massive investment by vehicle manufacturers, British car buyers have never enjoyed so much choice and, as today’s display shows, that extends to every fuel type. However, our survey highlights the need for ongoing government support for this new market.

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“We want to encourage more people to switch to ultra-low-emission vehicles in meaningful numbers, but more must be done to boost buyer confidence. A consistent approach to incentives – fiscal and otherwise – and, most importantly, greater investment in the charging network is essential if we are to grow this emerging market.”

Transport minister John Hayes said: “We are working with determination to get more people switching to low emission vehicles. Our Vehicle Technology and Aviation Bill published this week, will make sure the right infrastructure – such as electric charge points and hydrogen refuelling stations – is in place for this growing market.

“We’ve committed more than £2 billion since 2011 to increase electric vehicle uptake and support greener transport schemes. This includes £290 million, announced in the Autumn Statement, to support electric vehicles, low emission buses and taxis, and alternative fuels.”

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fadyady 23 February 2017

New VED bands

Incentives for pure electric cars remain. Incentive for plug-in hybrids have been reduced. What about diesel cars? How do the new Road tax system affect them? After all diesels were made popular over the years through systematic manipulation of the tax regime. As a poster has already suggested that not ling ago diesel cars made up only a fraction of the new car sales. Roughly the same as alternative fuelled cars muster today.
Campervan 23 February 2017

EV sales and Hybrid sales.

The most recent figures I have seen show EV sales in the UK are less than 1.5% of car sales with plug in hybrids being about 3% of UK sales. You would have to go back to the 80's to find diesel car sales under 5% of total sales. Will it take another 30 years before plug in hybrid and EV car sales to reach the current 50% of sales diesel currently has? Or will EV's and hybrid cars remain the preserve of the wealthy two car owners?
Mjrich 23 February 2017

BEV tax bracket is zero

The BEV tax bracket is zero, your article is very misleading. If your have a battery only car then you pay nothing. Surely it can't be that hard to understand. Hybrids and plug in hybrids pay, Battery electric vehicles do not.