Lemac Power - Blog #SMMT

Shifting Trends

Tue, 05 Nov 2024 13:36:21 +0000

October’s EV Registration Stats and the Rising Used EV Market

October 2024 presented a nuanced picture of the UK electric vehicle (EV) market. While new battery electric vehicle (BEV) registrations saw promising growth, the overall new car market faced significant challenges. Meanwhile, the used EV sector continued to thrive, offering an appealing alternative to budget-conscious buyers. This article dives into the October data, year-to-date (YTD) trends, and the growing relevance of the used EV market for Scottish buyers considering home EV charger installations.

The UK’s new car market fell by 6.0% in October, tallying 144,288 new vehicle registrations—a sobering sign of the hurdles ahead. Fleet registrations dipped by 1.7%, business purchases saw a sharp 12.8% decline, and private sales shrank by 11.8%, continuing a two-year downtrend. Despite these drops, BEVs stood out as a beacon of resilience, growing by 24.5% to secure a 20.7% share of the market. Of all the manufacturers, Volkswagen secured 9% of the BEV sales of October, with their range of ID cars due to expand further in the next year.

The expansion of BEV model choices—up 38% in 2024 to over 125 available models—was supported by aggressive manufacturer discounting. Interestingly, one in five BEVs were priced lower than the average petrol or diesel vehicle, a promising development for cost-aware buyers, especially those leveraging salary sacrifice schemes. However, the overall market still experienced an estimated £350 million loss in turnover.

The YTD data paints a picture of mixed progress. Although nearly 300,000 BEVs have been registered in 2024, capturing 18.1% of the market, this figure trails the 22% target and falls well short of the ambitious 28% goal set for 2025 under the Vehicle Emissions Trading Scheme. The increased Vehicle Excise Duty on low-carbon vehicles further dampens prospects for rapid fleet renewals, which are essential for decarbonization.

Scottish buyers, especially those eyeing new EVs, face decisions influenced by these trends. While the market adapts, homeowners should consider enhancing their EV experience with the convenience of a home EV charger from Lemac Power, tailored for efficiency and reliability.

Despite challenges in new car sales, the used EV market is thriving. In October, weekly listings averaged 135,000, with prices between £25,000 and £28,000, making them accessible to a wider range of buyers. Used EVs sold quicker, averaging 60-65 days on the market compared to 80-85 days for ICE vehicles. This strong demand, bolstered by a September surge to 14,839 sales (up from 8,248 a year prior), shows growing consumer confidence driven by affordability, and increased supply from off-lease models.

For buyers in Scotland considering a used EV, there’s never been a better time to take the leap. The availability of competitively priced, high-quality pre-owned EVs is expanding, offering the perfect opportunity to invest in cleaner driving without stretching your budget. Pairing your purchase with a reliable home charging solution can transform your EV experience. Lemac Power’s 7kW home EV chargers offer efficiency and simplicity, making them a smart choice for Scottish homeowners eager to support sustainable transport.

July's Growth in the UK new car market

Mon, 05 Aug 2024 12:35:05 +0000

Battery electric vehicle uptake outpaces overall market, up 18.8%, but remains behind mandated transition trajectory.

With new car registrations increasing by 2.5% in July 2024, the UK car market is continuing its two-year ongoing growth as s steady rebound from the disruptions caused by the pandemic. July alone saw 147,517 new cars hitting the road, making it the best performance since the post-lockdown surge of 2020.

A significant amount of this growth is the fleet sector, which recorded a 13.0% increase in registrations, securing a dominant 62.0% market share. In contrast, private demand has been declining, falling by 11.1% to account for only 36.2% of deliveries in the month. One interesting factor contributing to this decline is the rising popularity of salary sacrifice schemes.

Electrified vehicles (EVs) are making significant inroads in the UK market, outpacing overall market growth. In July, 42.0% of new car registrations were for electrified vehicles. Hybrid electric vehicles (HEVs) saw a notable 31.4% increase, capturing 14.5% of the market, while plug-in hybrids (PHEVs) grew by 12.4%, representing 8.9% of registrations. However, the real standout is battery electric vehicles (BEVs), which surged by 18.8%, capturing an 18.5% market share. Despite a 3% drop in the private share of the BEV market compared to last year, the volume of private BEV registrations still increased.

The UK government requires zero-emission vehicles to comprise at least 22% of each brand’s new car registrations. This ambitious target necessitates a significant acceleration in the pace of EV adoption. However, industry forecasts suggest that meeting this target may be challenging under current market conditions. The overall market growth forecast for 2024 has been revised downwards, with expectations of 1.968 million new car registrations by year-end. Similarly, the anticipated BEV market share has been adjusted downwards to 18.5% from the previously expected 19.8%, however this still represents a further 364,000 electric vehicles forecast to be registered by the end of 2024. These vehicles will then feed into the used car market in the coming 3-4 years as the fleets change in the future.

These trends underscore the dynamic shift towards electrified vehicles in the UK, driven by consumer preferences and regulatory pressures. As more consumers and businesses embrace EVs, the market is poised for continued evolution, albeit with some challenges along the way.

Salary sacrifice schemes are playing a pivotal role in this transformation. These schemes allow employees to lease electric vehicles through pre-tax salary deductions, making EVs more accessible and financially appealing. The financial incentives are compelling, with significant tax benefits, including lower Benefit-in-Kind (BIK) rates and National Insurance savings, making electric vehicles a cost-effective choice for employees. Additionally, employers benefit by managing costs effectively and supporting their sustainability goals, aligning with broader environmental initiatives and enhancing corporate social responsibility profiles.

Many salary sacrifice schemes now include essential services like maintenance, insurance, and home charger installation. These inclusions simplify the transition to electric vehicles and provide additional value to employees. For instance, Octopus Electric Vehicles includes a home charger installation in their package, enhancing the overall appeal of their salary sacrifice scheme. Similarly, The Electric Car Scheme offers straightforward options for home charging solutions, addressing one of the common concerns about EV ownership—convenient and accessible charging.

If your chosen salary sacrifice scheme does not include a home charger, there's a compelling alternative: Lemac Power. Lemac Power offers convenient, clever, and compact home charging solutions that can be seamlessly integrated with your new electric vehicle. The journey towards a greener future is well underway, and it’s exciting to see how these developments will continue. For those transitioning to EVs, home charging solutions like those from Lemac Power can provide the necessary support to make the switch smooth and efficient.

2024 so far in the New Car Market

Thu, 04 Jul 2024 14:32:58 +0000

UK registrations hit over 1 Million cars since the start of 2024

After the recent release of the SMMT figures for June, the UK new car registration market's trend for the first half of 2024 is quite evident. Despite reports pointing out a decline in retail sales, both monthly and year-to-date registrations show growth of 1.1% and 6.0% respectively compared to the previous year.

If this growth rate persists, the year-end projections suggest over 2 million cars could be registered by the end of 2024. The market is witnessing a rise in electric vehicles and Plug-in hybrids, constituting nearly 30% of new cars in June and almost 25% of the total registrations this year. Notably, Tesla maintains the lead in registrations, but other brands like Volkswagen are swiftly closing the gap. With traditional automakers expanding their EV offerings and EVs becoming available in all market segments, Tesla's current 22% new registration share is expected to diminish as the market transforms.

In response to the overall figures SMMT chief executive Mike Hawes says “The year’s midpoint sees the new car market in its best state since 2021 – but this belies the bigger challenge ahead. The private consumer market continues to shrink against a difficult economic backdrop, but with the right policies in place, the next government can re-energise the market and deliver a faster, fairer zero emission transition. All parties are agreed on the need to cut carbon and replacing older fossil fuel based technologies with new electrified powertrains is the essential step to achieving that goal.”

From within the industry Ian Plumber, Auto Trader commercial director says “June marked the 8th consecutive month of decline in retail sales - quite a contrast to the months of huge demand we've been tracking in the used car market. With average new car prices rising almost 40% over the last five years, it’s clear cost is the culprit. Manufacturers are responding with discounts but they're failing to keep pace, which is forcing many buyers to opt for a used alternative. Whoever forms the next government needs to address electric car affordability and provide long term stability for the market, securing the future of the salary sacrifice and Benefit in Kind schemes is essential as these drive the majority of new electric car uptake and it will be very difficult to scale without these. The market for used EVs is much stronger, which shows drivers are willing to go electric when the price is right”

However, looking at the bigger picture, Fleet sales of Battery Electric Vehicles (BEV) are on the rise. Although new registrations for these vehicles among private buyers are slower, overall sales are increasing. This growth can be attributed to the surge in Salary Sacrifice schemes that are particularly favorable for electric vehicles. These schemes are attracting customers who would typically have purchased a vehicle as consumers and are now shifting them to become Fleet users.

Ian Plumber points out that pricing and discounts are steering customers towards considering used alternatives. The expanding presence of electric vehicles that are up to 5 years old in the second-hand market offers customers a wide selection to transition to electric options. There are nearly ten times more used electric vehicles up to 5 years old compared to those introduced in the UK after that period. With this abundance of choices, buyers who previously had to purchase a new EV to enjoy the benefits can now opt for a relatively new used vehicle and still experience improvements in range and features.