Electric Car Demand Sinks as Drivers Face Pay-Per-Mile Tax
Demand for electric cars has slumped as Rachel Reeves prepares to hit them with a new pay-per-mile tax. The Telegraph has more.
Electric vehicle (EV) sales grew at their slowest rate in two years in November, at just 3.6%, according to figures from the Society of Motor Manufacturers and Traders (SMMT).
Mike Hawes, the Chief Executive of the SMMT, tied the slowdown to the Budget and its long build-up.
He said: “Even in a fragile market, zero-emission vehicle uptake continues to rise, which is exactly what we need. But the weakest growth for almost two years – ahead of the Government announcing a new tax on EVs – should be seen as a wake-up call that a sustained increase in demand for EVs cannot be taken for granted.
“We should be taking every opportunity to encourage drivers to make the switch, not punishing them for doing so, else the ambitions of Government and industry will be thwarted.”
The Chancellor announced a new pay-per-mile road tax for EVs in last week’s Budget. The levy will charge drivers of electric cars 3p per mile when it comes into force in April 2028 – costing them around £250 a year on average.
News of the policy was first revealed by the Telegraph on November 6th.
The change is meant to make up for lost fuel duty and to start bringing EVs into line with petrol and diesel vehicles. A typical petrol car driver currently pays around £600 per year in fuel duty, which is effectively a tax on distance travelled.
However, the car industry has warned that the new tax risks damaging demand for EVs, which are more expensive to buy than petrol alternatives.
The number of EVs sold climbed to 39,965 in November. Fully electric cars made up 26.4% of all new car sales in November, up from 25.1% a year ago. The SMMT said the recently introduced electric car grants supported sales.
However, the proportion of EV sales still falls short of the 28% annual target. Carmakers who fail to meet this level risk fines.
Worth reading in full.
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Doesn’t a flat rate tax calculated by the distance travelled undermine the concept of improving energy efficiency? After all, with excise duty + VAT on fuel there is an automatic relationship between efficiency and tax paid. A new tax based on the actual energy used per vehicle would be more complex, but more in line with the existing set up for fuel oil purchase.
Yes. Flat pay-per-mile assumes that an electric supercar gets the same mileage as a Nissan Leaf or whatever.
The use of agricultural diesel for private transport can avoid the fuel duty cost at the risk of significant fines or even jail time if you’re found to have the wrong fuel in your tank. I’m not sure how they would label electrons for one purpose or another.
What they can do is to increase the VAT on at least the public chargers, and as there is a requirement to have “smart” (SMETS-2) meters installed when home chargers are to be installed, it could become possible to charge different VAT rates. Modern charger units like the Zappi can communicate with the Data Communications Company, so the hardware is already there. It’s the bureaucratic code that would be necessary.
Although the original intention of such devices was to manage the load on the distribution network to some extent, the use of it to supervise and tax the users as well is no surprise, at least in the minds of us sceptics and cynics.
Alright, there’d be ways around it, like using the low current “granny charger” cable to save tax, but it depends how long one wants to wait.
Sod that, why should you avoid VAT on your fuel, cheeky sod.
I strongly doubt the people pushing these policies are actually interested in “energy efficiency”.
Indeed, they’re most interested in trying to stop people doing what they want, when they want, where they want to do it.
The principle of market acceptance of a technology is total anathema to Marxists.
… and sod what the customers want.
My thoughts exactly, f. the government and the smmt, let the consumer decide what they want to buy
You guys are clearly radicals, wanting a free market?!? 😉
The headline is misleading. Electric car demand growth has slowed, but demand is still growing. Very depressing.
If you take out all the manufacturer pre registered ‘sales’ I’d estimate it’s flat at best, probably declined last year or so
We need it to start falling ideally
However all of the usual suspects are lying through their teeth, especially the SMMT.
Hawes is an EVangelist so not to be trusted.
Nope. Not if they’re better for whatever people want a car for.
But I don’t want other people (especially me) paying extra so someone can have an EV.
I want it to fail to further demonstrate the whole thing is a scam
Have a look at Barrie Crampton’s Youtube channel and see what he discovers about EV demand.
“Mike Hawes, the Chief Executive of the SMMT…..said: “Even in a fragile market, zero-emission vehicle uptake continues to rise, which is exactly what we need.” Why is it what we need? The generating and charging infrastructure to support EVs isn’t capable, renewables aren’t capable and with the subsidies required are expensive, cheaper and available hydrocarbons are within reach but ideologically proscribed, at least by Ed Milliband. What we need is a coherent long term energy strategy which is predicated according to the available resources, not unicorn farts.
*to support EVs isn’t capable
Thanks for the edit Hardliner, I think I was autocorrected. Or just over stimulated (by the guff I responding to)
The capability of the infrastructure no doubt varies. E.g. in my street (with relatively new distribution cable) it would not be practical for every house to have EV charge units, unless the district network company has the ability to manage them remotely to keep within the capacity of their local transformer & buried cable on constant loads. However, we do not have deals with the DNO, but with a variety of other utility firms that happen to use the same cable. That’s an aftermath of how it was privatised.
My entire street was recently (within the last month) dug up for a week to install charging points in just 3 out of about 20 houses. I can see that further work is going on in adjacent streets. But we have not got the generating capacity to supply the kind of loads required if there is a consistent uptake of EVs, not to mention that gas (cooking, heating) has suddenly gone from clean, efficient and natural to dirty and carbon dioxide (plant food) producing.
Don’t worry, there will be no consistent uptake, they can’t give the crap away.
Sad I know, but I’ve read numerous Life-cycle Cost Analyses (LCA) – that include the ecological costs of production, operation and disposal – comparing EVs with ICEVs, and the only way to ‘crown’ EVs is to assume Ed Milliband’s ‘cheap energy from renewable sources.’ Of course, except in DESNZ, it is common knowledge that there is no such thing. Also, several LCAs require fantastical trouble-free operational mileages (>100,000mls) and exclude battery changes, in order to award EVs a clear throughlife ecological win.
My hat is off to you, I don’t have the intellectual stamina to torture myself with those kinds of analyses. However I do know that if Ed Milliband is for something that I am against it. That and the fact that he cannot support his arguments when challenged other than by saying that it gives the UK a leadership position on the world stage, which therefore justifying his jetting around the world business class.
Incidentally my 12 year old Subaru turbodiesel SUV has 100,000 miles on the clock and according to the dealer is good for another 100,000
With any luck, the pay-per-mile tax will disincentivise enough drivers to tank the EV market entirely. Then no government can insist on us all driving them by the year 2030 or whenever.
Quite, let people decide their own use of vehicles. Even this utterly anti-EV driver is prepared to allow others to decide their own lives, what I want it the total removal of government decision making in everything that matters. Everything.
‘Even in a fragile market, zero-emission vehicle uptake continues to rise’
No it doesn’t. It’s off a cliff, it’s a complete disaster. It could not be worse.
The awful things are hated by 97% of drivers.
Mark my words. EV’s will bring the CCP to bankruptcy. Why make something NOBODY wants?
Bankrupt the CCP?
So there is one good thing about EVs.
The bungling buffoons are running the show. They want people into electric cars and then penalise them for having one. They want solar panels on our roofs and then propose to BLOCK the SUN. We are governed by MORONS
https://easysociology.com/sociology-of-ideology/what-is-a-kakistocracy/
“It’s inevitable Mr Anderson.” (1999. The Matrix.)
This whole boondoggle was only ever about numerate people with a few quid, optimising ‘subsidies.’ Remove the tax-payer funded enticements and it’s all over.