‘Year EVs became mainstream’ but infrastructure, pricing concern buyers – Deloitte
Responding to the Society of Motor Manufacturers and Traders’ 2021 new car registration data, analyst Deloitte has proclaimed 2021 “the year electric vehicles became mainstream”. It added that range issues are receding as a headwind thanks to technological progress. It identifies the speed of charge point infrastructure and the price of entry post-subsidies as the major headwinds for the sector in 2022.
Jamie Hamilton, automotive director and head of electric vehicles at Deloitte, said: “Despite the challenges posed in the last year, electric vehicles continued to perform above and beyond expectations. In December, sales of battery (BEV) and plug-in-hybrid (PHEV) electric vehicles accounted for over a third (33 per cent) of all sales. Across the whole of 2021, this figure was 19 per cent, compared to just 11 per cent in 2020.
“With more than one in ten new cars now fully electric, 2021 is the year that EVs became mainstream. However, there are still barriers that the industry needs to overcome to sustain growth ahead of the 2030 ban on polluting vehicles.
“Deloitte’s Global Automotive Consumer Survey data this week highlights that UK consumers still identify driving range, and a lack of public charging infrastructure among the main barriers to purchasing an EV.
“In reality, driving range is becoming less of an issue for EVs. Just this week we saw a number of new models and prototypes unveiled, pushing the boundaries of what a battery is capable of. However, the perceived lack of public charging infrastructure remains a potential issue, with significant investment required to avoid an imbalance whereby EVs are only a realistic option for consumers with off-street parking.
“Consumers also expressed concern over the perceived price premium attached to EVs at a time when subsidies are being reduced.”
Covid, component shortage continue to loom large
In the overall car market, Hamilton added that the issues that heavily affected new car sales in 2021 “continue to loom large over the automotive industry and many manufacturers expect sales to be compromised well into the second half of 2022.”
He continued: “New car sales in December declined by -18 per cent compared to the same period in the previous year, as fleet sales suffered major losses, falling by -40 per cent.
“The disappointing end to the year is a consequence of two major headwinds faced by the industry in December. Firstly, supply issues caused by the ongoing semi-conductor shortage continued to act as a drag on sales, with longer-than-usual waiting times still a reality for many consumers. Meanwhile, the emergence of a new COVID-19 variant dented consumer confidence, with some likely postponing showroom visits in the immediate run up to Christmas.
“Overall, 2021’s sales have only marginally improved from the pandemic-induced lows of 2020. 1.65 million new cars were sold across the entirety of the year, compared to 1.63 million in 2020.
“At the start of 2021, many voices in the industry were optimistic that we would see substantially higher growth than 1 per cent. However, more COVID-19 restrictions and the semi-conductor shortage – which caused supply issues throughout the entire year – limited any chance of a sharp recovery.