The SMMT, as well as the car industry it represents, firmly believes government incentives could be the key to turbocharging sales, which have largely been artificially stimulated thus far by what the trade body describes as “unsustainable” discounts by manufacturers; in 2024, car makers spent £4.5 billion discounting EVs in order to secure sales and thus meet the UK’s tough ZEV mandate targets. This, SMMT CEO Mike Hawes was keen to point out, “is the equivalent of a third of the UK’s overseas aid budget, before it was cut. Let that sink in.”

As a result, the SMMT is calling for cuts in VAT on the purchases of new electric cars – something the trade body believes could generate 250,000 more EV sales per year – as well as on public EV charging, which currently is responsible for a huge price disparity between charging at home and away.

EVs are also due to become liable for Vehicle Excise Duty (also known as road tax) next month. Hawes noted that while he does not necessarily oppose such a move, given what he described as “the obvious constraints on the public purse”, he did call for a rise in the threshold for models to fall under the umbrella of the so-called “expensive car supplement”, which currently sits at £410, on top of the £195 annual VED.

Speaking at the SMMT’s Electrified conference in Westminster, Hawes said “as a minimum, we should be raising the luxury car threshold to [models over] £60,000” – a sentiment that received backing from Kia’s UK CEO, Paul Philpott.

In the next couple of months, the government is set to announce the outcome of its review into the ZEV mandate, which could relieve the pressure on manufacturers to sell electric cars to what appears to be an as-yet relatively uninterested market.

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