Mr Hawes said much of the EV sector’s inroads into the market had come from purchases by fleet managers and businesses, where the incentives were stronger.
“Private consumers used to have about a third of total sales, it’s down to about a quarter now. So we believe every option needs to be considered to help that private consumer transition with targeted support.”
EV adoption hurdles
Registrations of new EVs in Britain – Europe’s second-largest market for electric cars – jumped almost 40 per cent in the year to August 31 from the same period a year earlier, SMMT data shows.
In the past five years, the market share of battery EVs has jumped from 0.7 per cent to 16.4 per cent. They now outsell every other category of car, such as diesel and the various hybrids, except for petrol cars.
But the government last year axed the Plug-in Car Grant, which the SMMT said had left Britain as “the only major European market with no consumer EV incentives, yet the most ambitious transition timeline”.
A survey of almost 12,000 British motorists by trade journal electrifying.com and road user group AA found only 9 per cent of respondents who said their next car would be an EV.
Some 87 per cent said EVs were too expensive, and 66 per cent said rising energy prices had deterred them. More than two-thirds said there was not enough public charging infrastructure, three-quarters had range anxiety, and 84 per cent opposed the 2030 ban on new petrol cars.
Compelling and complex
Volkswagen’s mass-market EV, the ID3, is about £4000 ($7695) more expensive than an equivalent Golf, but the company is keen to try and persuade consumers that the life-cycle costs – assuming the EV can be charged at home – outweigh the sticker price.
“The retail price of an electric car versus an equivalent petrol or diesel car, you will find a premium because the technology is new and the volumes and economies of scale so far are not fully realised,” said Alex Smith, managing director of Volkswagen UK.
“But when you look at the operating costs, when you look at the fuelling costs … then the argument is far more compelling.”
He admitted that persuading consumers was “complex”. As well as incentives, the task “needs more reinforcement, it needs common standards, it needs great communications”.
Interoperable, extremely reliable
Mr Smith also conceded that Britain’s charging infrastructure was overly concentrated in London and its southern environs, where most of the EV take-up had been.
“Over the last few years, we haven’t necessarily seen infrastructure develop ahead of demand. We’ve got catching up to do, and then we’ve got further acceleration and progress to make,” he said.
“What we’re trying to do here is to encourage the next phase of adoption … [the infrastructure] needs to be very well planned and very well integrated, it needs to be interoperable, and it needs to be extremely reliable.”
Mr Smith said the industry wanted “all of the regulation and all of the fiscal policymaking [to] ensure that we will be encouraging technology adoption”.
Mr Hawes welcomed the government’s lavish backing for the battery making sector. But he fretted that the government was still yet to issue regulations governing the five-year transition period from petrol to electric that starts in 2030.
“We need to make sure we have the foresight, we have the clarity to be able to plan and continue to transition. So we do still need some solutions,” he said.
Avoid China trade war
Mr Hawes also expressed concern that Britain was now at the 11th hour on negotiations with the European Union over potentially punitive new tariffs and rules of origin on cross-Channel trade in EVs. If the rules come in as planned next year, the British industry could be pummelled.
Meanwhile, the EU is considering whether to jack up tariffs on Chinese-made EVs, as the US has done. Mr Hawes refused to be drawn on whether he would welcome a similar initiative from Britain.
He said it was too early to respond to the EU’s probe into Chinese state subsidies, which was only announced last week and could last nine to 12 months.
Mercedes-Benz chief executive Ola Kallenius told Bloomberg Television that he wanted to avoid a trade war with China on EVs.
“Open markets is what drives growth and what drives wealth creation,” he said. “Let’s keep markets open and let market participants fight it out.”
Transport Secretary Mark Harper told the SMMT conference that “cleaning up cars and vans represents the biggest challenge and greatest opportunity to reach net-zero by 2050”.
He said the industry should push ahead towards the 2030 deadline, and the government’s job was to “back motorists to travel how they want, where they want to and when they want to”.
“It is not about forcing people out of their cars,” he said, in a signal that his government will continue to position the Labour opposition as waging “a war on motorists”.