Electric Car Discounts Are ‘Unsustainable’ Amid Rising Sales, Warns Car Group
Government discounts for electric vehicles (EVs) are deemed unsustainable by a leading motoring group, coinciding with a significant rise in new car registrations in the UK. The Society of Motor Manufacturers and Traders (SMMT) recently reported that in 2025, over two million new cars were registered, marking the highest number since the pandemic began.
– Nearly 500,000 of these new sales were electric vehicles, representing a market share of 23.4%.
– The total number of registered cars was 2,020,373 in 2025, reflecting a continuous growth trend for three consecutive years.
– While the current figures are an improvement, they fall short of the 2.3 million cars sold in 2019.
Growing Challenges in Electric Car Sales
SMMT’s chief executive, Mike Hawes, welcomed this progress but highlighted that sales of electric cars are not accelerating quickly enough to meet the government’s set targets. He pointed out:
– The government’s Zero Emission Vehicles Mandate (ZEV Mandate) aims for electric car sales to reach 28% market share.
– Currently, electric vehicles are still below this target, showing a growing gap between consumer demand and governmental ambitions.
– Many car manufacturers are compelled to offer significant discounts, estimated at over £5 billion last year, averaging around £11,000 per vehicle sold, to boost electric car sales.
Hawes stressed that such discounts are not a sustainable practice, especially with expectations for manufacturers to meet a more rigorous target of 33% this year. He urged the government to expedite the review of the ZEV Mandate, initially scheduled for 2027, to adapt to the changing economic landscape.
Call for a Review of EV Mandates
Hawes elaborated on the need for the review by stating:
– The automotive industry needs a framework that reflects current market realities, particularly considering rising energy prices and increased raw material costs.
– There is a delicate balance to strike; the automotive sector has heavily invested in electric vehicles and must continue evolving to meet demand.
Despite the challenges, some industry commentators maintain a positive outlook on the ZEV Mandate’s impact. Colin Walker from the Energy and Climate Intelligence Unit noted:
– 2025 has been another bumper year for EV sales, with nearly one in four cars sold being an EV.
– This increase can potentially enhance the second-hand electric vehicle market, providing relief for consumers in today’s economic climate.
Government Initiatives and Future Concerns
Over the past year, the government has rolled out various measures to support electric vehicle adoption:
– The £1.3 billion Electric Car Grant Scheme, offering up to £3,750 toward purchasing an EV.
– Significant investments in charging infrastructure.
However, recent budget announcements included plans to introduce a ‘per mile’ tax on electric vehicles. This proposed tax could negate some of the benefits provided by existing grants, leading to an expected reduction of 440,000 electric cars sold over the next five years.
Hawes remarked on the potential implications of such a tax:
– To have a technological shift like this, you need consistent, coherent, and compelling messaging and support. Even the introduction of a tax on EVs sends a conflicting message to consumers.
As electric vehicle sales continue to climb, the way forward will require a careful balance of incentives, support measures, and pragmatic policies to navigate the evolving automotive landscape.