Nearly two thirds (64%) of UK drivers do not expect their next car purchase to be purely electric, according to the latest ‘The Road Ahead’ research from Close Brothers Motor Finance.
Only one-in-ten of those surveyed expect their next vehicle to be electric, compared to 30% still looking towards petrol, which remains the most popular choice. More than one-in-five expect their next purchase to be a hybrid, and 13% would still turn to diesel despite legislative pressure away from the fuel type.
With the UK in the midst of a cost-of-living crisis, the financial considerations are invariably the key barrier prohibiting consumers from making the switch to electric. When asked about what they perceived to be the biggest barrier to the adoption of electric cars, 21% said the initial cost of EVs was the greatest concern, closely followed by the cost of electricity (20%). A lack of charging infrastructure (17%) is also steering drivers away from electric, while 15% are worried about range anxiety (fear of running out of battery).
However, it is clear from the research that there is an appetite for EVs should they be more financially viable for consumers. In terms of what buyers would like from an electric car, 39% said lower running costs would make them want to purchase one, and more than a quarter (27%) would turn to them for environmental benefits. More than a fifth (22%) would be tempted by incentives such as grants and tax savings, and a further 19% stated perks such as no congestion charge as an enticing factor. Just one in five (21%) said nothing would motivate them to make the shift to electric.
Though the cost-of-living crisis is the main factor stifling current demand, this should only be an issue in the short-term. Recent SMMT data showed battery electric vehicles became the second most popular powertrain in 2022, behind petrol cars. This is a trend set to continue as 2023 is poised for strong growth.
Lisa Watson, Director of Sales at Close Brothers Motor Finance, said: “Given the current economic climate and financial pressures faced by many UK households, it is unfortunately not surprising that costs are prohibiting more widespread EV adoption in the UK.
“Coupled with the financial outlay, consumers will be feeling particularly frustrated by other factors such as the current charging infrastructure which still has some way to go to efficiently meet demand. As financial benefits are the biggest factor for encouraging people to switch to electric, the government’s recent Autumn Statement announcement that EVs will now be subject to Vehicle Excise Duty from 2025 will only function as another barrier. The government need to be offering incentives, not taking them away.
“Not only is this going to put further strain on consumers’ wallets, it will also significantly limit the environmental benefits associated with EVs. However, though the outlook remains negative for the time being, this very much appears to be a short-term problem, as recent SMMT data shows that the general trajectory and growth for EVs is positive, and dealers should still be preparing. For the time being the onus is on dealers and finance providers to use all available tools and insight to best meet consumer demand and optimise pricing.”
