Monday , June 27 2022

Why the UK failed to take advantage of the thriving electric car revolution



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Miles Willis / Stringer / Getty Images

The UK's electric car market is in trouble. The public does not buy electric cars, nor does the automotive industry do them.

“Many people in the government believe that the future is electric cars, and that we're going to be at the forefront of the electric car and the autonomous vehicle revolution,” says Andrew Graves, professor of mechanical engineering. at the University of Bath. But we are lagging behind.

A report by the European Automobile Makers Association (EAMA) shows that after the other European countries, electric car sales are seriously lagging behind. In the first quarter of 2019, total electrical taxable vehicle registrations – hybrids and fully electric vehicles – increased by only 2.9 per cent, compared to the EU average of 40 per cent. France and Germany fully registered 10,569 and 15,944 electric vehicles; the UK figure is only 5,997.

One key reason for selling slowly from comparison to the rest of Europe is last year's decision by the British Government to cut subsidies for pure electric cars from £ 4,500 to £ 3,500, and to completely remove the grant t o £ 2,500 for hybrid vehicles. This increased the price of already expensive vehicles. When Tesla lost her federal tax credit $ 7,500 (£ 5,890) to the United States in early 2019, there was a big drop in demand for a 3-year model sedan. Only 63,000 were achieved in the first three months of 2019, compared to 90,966 in the fourth quarter of last year.

The UK seems to lose out on both ends of the electric car boom. The EAMA report comes from the back of the news that Dyson, the UK company best known for its vacuum cleaners, would be building its first electric car in Singapore.

In fact, this is a trend that is wider than just electric vehicles. The UK doesn't make a lot of cars anymore. Honda will close its huge factory in Swindon by 2021 and Jaguar Land Rover recently said that it would build its next generation of Defender in Slovakia. “You have lots of specialist makers such as McLaren and Aston Martin: quite low volumes, high performance,” said Sam Akehurst, professor of advanced powder systems at Bath University.

Electric cars also have a supply and demand issue, says Akehurst, professor of advanced powder systems at Bath University. "They are [manufacturers] you can't get value for money and actually afford to make electric vehicles in the needed volumes, and there's no battery capacity there to supply that volume of vehicles, ”says Akehurst. “Our business justification is quite hard at the moment as the batteries are still relatively expensive and marginal on the car very small.” T

Despite steady growth, there is still no high demand for electric vehicles on the market – electric cars account for less than one per cent of new car sales worldwide. It is difficult to find enough people who want to pay a premium price for electric vehicles. The market has a high end and low head, but not in the middle. “You've got a kind of premium luxury vehicles like Tesla where they're trying to break into a cheaper mass market vehicle,” says Akehurst. “Then you have Nissan with the Leaf and Renault with the Zoe at the other end of the market”.

But the market will only grow as large car companies push to achieve carbon emissions targets. “All car manufacturing companies invest heavily in electric vehicles and hybrid vehicles, mainly because legislation measures leaks from roof pipes,” says Graves. “If you want to get into leaks on the tail pipe, which many legislators want to do, especially in cities and towns, you have to go for electric vehicles.” T

At the moment, for newcomers to the electric car market, other countries offer more than Britain. Singapore, where Dyson bases its operation, represents a more attractive proposition for manufacturing than the UK, with its low rate of corporation tax, driven by a huge incentive from the Singapore government. .

“Corporation tax is around 18 per cent in Singapore” says Graves. “But if you employ enough people, you could negotiate it down to five per cent, or even zero – you could not pay any corporation tax. Another reason is Brexit – especially the gallon as James Dyson is a bow-Brexiteer. Singapore has recently signed a trade agreement with the EU, so the move will allow Dyson to export to Europe without a tariff.

There have been some UK successes. The Nissan Leaf is the most popular electric car ever, having sold 360,000 units since 2018, and all European Leaf models have been built in Sunderland. Nissan's commitment to manufacturing in Britain may be weakened, however – the company announced in February that it will not build a new model of one of leading vehicles in the north-east.

The success of the Leaf shows that electric vehicles are still an opportunity for the UK. The government could renew its commitment to its manufacturing by renewing subsidies, and revitalizing industry that is highlighted. For now, however, the picture remains one of falling sales and factory closures – Europe is becoming electricity, while the UK is lagging behind.

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