New car demand across all buyer types fell back in October but take-up of fully electric vehicles soared.

Battery electric vehicles (BEVs) were the only powertrain to record growth

The overall market shrank 6.0% in October to 144,288 new registrations, according to the latest figures from the Society of Motor Manufacturers and Traders (SMMT).

Fleet take-up was down 1.7%, marking the second decline this year, while ‘Business’ registrations to fleets with fewer than 25 vehicles market dropped 12.8%.

Private purchases were down 11.8% in a continued two-year-long slump. Fewer than four in 10 (38.8%) of new cars registered in the first 10 months have gone directly to private buyers.

Petrol and diesel vehicles both saw double-digit drops, down 14.2% and 20.5% respectively. Hybrid electric vehicles and plug-in hybrid electric vehicles also fell, down 1.6% and 3.2%.

In fact, battery electric vehicles (BEVs) were the only powertrain to record growth, up 24.5% to reach a 20.7% share of the market compared to 15.6% for the same month last year.

The SMMT said a raft of new BEV models had helped drive growth. UK new car buyers now have more than 125 different BEV models to choose from – an uplift of 38% over the last 10 months.

But the business group also noted that manufacturers continue to subsidise the EV switch with billions in discounting to help meet their ZEV mandate sales targets.

While the average BEV still has a higher upfront cost than an ICE equivalent, huge manufacturer discounting means that around one in five BEV models is now sold for less than the average petrol or diesel.

The year-to-date figure also shows the mountain still to climb for carmakers to meet ZEV mandate. Almost 300,000 new BEVs have reached the road so far in 2024, accounting for 18.1% of the market – an increase on the 16.3% for the first 10 months of 2023, but still significantly short of the 22% target for this year and of the 28% which must be achieved in 2025 under the Vehicle Emissions Trading Scheme.

The SMMT also called out last week’s Budget, which extended existing business and fleet incentives for BEVs, but effected big changes for vehicle excise duty and company car tax for plug-in hybrids and ICE vehicles at large.

The automaker trade body said the changes disincentivise low-carbon vehicle purchases and fleet renewal generally, risking a delay to the overall reduction in road transport emissions.

Mike Hawes, SMMT chief executive, said: “Massive manufacturer investment in model choice and market support is helping make the UK the second largest EV market in Europe. That transition, however, must not perversely slow down the reduction of carbon emissions from road transport. Fleet renewal across the market remains the quickest way to decarbonise, so diminishing overall uptake is not good news for the economy, for investment or for the environment.

“EVs already work for many people and businesses, but to shift the entire market at the pace demanded requires significant intervention on incentives, infrastructure and regulation.”

Philip Nothard, insight director at Cox Automotive, said the decline in the UK car market highlights significant industry challenges

“Private demand for EVs remains weak despite an array of model choices and heavy, unsustainable discounting from manufacturers. While BEV uptake rose, driven largely by fleet purchases, this growth masks an underlying softness in consumer interest. The gap between ambitious EV targets and actual consumer behaviour is widening, making it clear that broader support is needed for a fast and fair transition.

“With the projection close to two million units by the end of 2024, attention now turns to 2025, when the reliance on aggressive discounts and limited private EV demand may no longer be viable.

“Structural shifts and stronger incentives will be critical to achieving sustainable growth, helping align policy goals with consumer readiness and ensuring the industry’s long-term stability.”

October figures show ‘ZEV targets are doing their job’

ChargeUK, however, has called on the Government to stay firm on ZEV mandate targets.

Vicky Read, ChargeUK CEO

Vicky Read, CEO of the charge point operators’ trade association, said: “At its core the EV transition needs two things – EVs to be sold and chargers to be deployed.

“Today’s SMMT figures, the third month in a row of sustained and solid EV sales, shows the demand from drivers is there and the ZEV targets are doing their job.

“Those same targets are the bedrock for £6bn of private investment in charging infrastructure, which is also being rolled at record rate, month after month, ready for all those new EVs.

“No one ever said the ZEV mandate was going to be easy, but it’s working; weaken the targets now and willingness to invest in charging will dissipate and the EV transition will grind to a halt.”

And James Court, chief executive of EVA England, said: “Another positive month of sales figures as the industry keeps on track to achieve the ZEV mandate despite the negativity from some. It’s now time for the sector as a whole to demonstrate that EVs are working for the vast majority of drivers and get behind the transition.”

Many industry spokespeople called for further action on charging.

Sue Robinson, chief executive of the National Franchised Dealers Association (NFDA), said: “Although the Chancellor acknowledged the significance of electric vehicles in the Autumn Budget, such as maintaining current incentives for EVs in company car tax, investment in charging infrastructure is also vital to drive demand further.”

James Garlick, EV commercial lead at Hive, also said that “attention must now focus on ensuring the UK’s charging network can withstand the EV demand and ensure that nobody is left behind”.

Jamie Hamilton, automotive partner and head of electric vehicles at Deloitte, commented: “As the commitment to phase out cars that rely solely on petrol and diesel engines by 2030 was confirmed in the Budget, measures to provide further investments in charging infrastructure, especially in those areas where access remains limited, will provide some impetus to drivers who still remain on the fence about switching to electric.”

And Russell Olive, UK director at Vaylens, said: “To avoid momentum stalling, the industry needs more investment. Efforts to increase the availability and distribution of charging points need to be continued. It’s also important that there is a plan in place to manage the growing amount of charging infrastructure. Robust systems that simplify the way charging stations are accessed, maintained and monetised are needed to ensure a seamless EV experience.”

Roadchef said it’s seeing heightened demand for EV charging points across its estate and called for a concerted effort on charging.

Sajid Yacoob, EV and renewables director at the motorway services operator, commented: “It’s incredibly important that we ensure EV demand is energised and to do that we can’t just rely on tax incentives. EVs need to drive demand on their own merit. To get there, we must tackle range anxiety and continue expanding charging infrastructure. At Roadchef, we’re leading the charge, committing to 650 fast charging points across our locations and piloting innovative solutions for heavy goods vehicles.”