June 22, 2024
News

ZEV mandate leads to decreased prices of new electric vehicles

The Zero Emission Vehicle (ZEV) mandate in the UK has resulted in price reductions for new electric vehicles (EVs), with discounts available on 75% of new models.

This initiative aims to ensure that 22% of UK vehicle registrations are electric to avoid significant financial penalties for manufacturers.

Auto Trader‘s Road to 2035 Report highlights the impact of the ZEV mandate, despite the postponement of the sales ban to 2035.

The report reveals that 70% of new electric models are now being advertised at lower average prices, as the automotive industry works to stimulate demand to meet the mandate’s requirements.

While new electric car sales have seen an increase, this growth is primarily driven by the fleet and business sector.

Private car buyers appear less enthusiastic, with EVs accounting for less than one in ten new cars sold to this group.

Interest peaked in June 2022, with EVs making up 36% of advert views on Auto Trader, but has since stabilized around 14%.

FAQs

1. Are electric cars more affordable now?

Yes, with the ZEV mandate in place, discounts are being offered on 75% of new electric models, making them more affordable.

2. What percentage of potential car buyers are considering electric for their next purchase?

Over a third (34%) of potential car buyers are considering electric for their next purchase, showing a positive shift in interest.

The used car market, where two-thirds of UK drivers shop, is expected to see a significant impact from the increased interest in EVs, with advert views and enquiries for 0-5-year-old EVs reaching record highs.

However, affordability remains a major challenge for widespread adoption, as the used electric market has experienced 20 months of consecutive price declines.

Conclusion

While there has been a positive shift in consumer interest towards electric vehicles, affordability remains a significant hurdle to widespread adoption. The automotive industry’s efforts to offer discounts on new electric models are encouraging, but more progress is needed to make electric cars accessible across different budgets.



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