FYI: In a bid to meet the UK’s evolving EV quotas, certain UK car dealerships are delaying the delivery of gas-powered vehicles to nudge buyers towards electric cars, potentially altering the automotive landscape.
UK Car Dealers Delay Gas Vehicle Deliveries to Push EV Sales
Author: William Kouch, Editor of Automotive.fyi
As the United Kingdom accelerates its transition towards electric vehicles (EVs), an interesting shift is occurring in how car dealerships handle vehicle deliveries. To align with the UK government’s stringent Zero Emission Vehicle (ZEV) targets, certain dealerships are delaying the delivery of internal combustion engine (ICE) cars, hoping to increase EV sales.
UK’s Annual EV Quotas and Their Ripple Effect
To support its ambitious goal of selling only new electric cars by 2035, the UK government has imposed a rising annual EV quota on manufacturers. For 2024, this targets 22% of all new car sales being electric. However, with stagnating consumer demand for EVs, dealers are pushing back the delivery dates of gas vehicles to meet these mandates.
According to The Telegraph and data from the Society for Motor Manufacturers and Traders (SMMT), the earlier prediction that EVs would account for 19.8% of new car sales in the UK this year has been trimmed to 18.5%. This adjusted figure is buoyed largely by corporate fleet additions, rather than individual consumer purchases.
The Dealership Strategy
Robert Forrester, CEO of Vertu Motors, highlights that vehicles ordered today at specific dealerships will not be delivered until February. This deliberate delay is a tactic to avoid missing the mandated 2024 EV quota. The consequence? A heightened interest in the second-hand car market.
Forrester states, "In some franchises, there’s a restriction on the supply of petrol and hybrid cars, which are in high demand. It’s a paradox where we can’t meet the demand for these vehicles, but have an abundance of cars that consumers are less interested in—primarily EVs."
Cooling Demand for Electric Vehicles
This decline in EV demand is not exclusive to the UK; it’s a global trend. The dip has been significant enough that some manufacturers are beginning to reconsider their plans for a full transition to electric production. This discrepancy between governmental goals and market realities could lead to friction and a potential undersupply of desired vehicles—mainly hybrids and plug-in hybrids.
In line with these challenges, the UK government plans to gradually increase the EV quota until it reaches 80% by 2030, with the sale of solely electric vehicles commencing in 2035. Similar targets are set across Europe. Yet, given current buyer preferences, which skew towards hybrids rather than fully electric cars, achieving these goals appears increasingly challenging.
Financial Incentives and Their Impact
Manufacturers have heavily invested in EV development, underpinned by the promise from governments that these cars would have ready buyers. However, EV sales haven’t met expectations, partly because many European governments have started to reduce tax credits and other incentives that made EVs financially appealing. Without these perks, many buyers are reverting to traditional combustion engines due to the higher costs of EVs.
Conclusion
The UK’s push towards electric mobility underscores the classic tension between legislative ambition and market reality. As car manufacturers and dealerships grapple with meeting stringent government quotas, consumers’ preferences and wallets tell a different story. This dynamic promises to shape the automotive market for years to come, and dealerships’ current tactics may just be the beginning of more strategic shifts to come.
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