Online car marketplace Auto Trader has claimed demand for electric vehicles is “waning” as a result of the cost-of-living crisis. The company says the number of people searching for electric vehicles on the website has fallen since the summer as fuel prices have reduced and energy prices have increased.
According to a company report, electric vehicles (EVs) represented more than a quarter (27 percent) of all new car enquiries being sent to retailers through the Auto Trader website during the month of June, when petrol prices almost hit £2 a litre. However, in November, when fuel prices were falling and energy prices on the up, EVs accounted for 19 percent of all enquiries.
The report also reveals a year-on-year drop in demand for EVs for the first time since the start of the coronavirus pandemic. Overall, demand was down by 12.6 percent in the past 12 months amid rocketing electricity bills.
As demand softens, the number of used EVs available has been on the up as previous years’ new cars enter the second-hand market. Auto Trader reckons stock levels have almost doubled from 10,600 at the start of 2021 to 20,600 in the third quarter of 2022. That increase has coincided with the dip in demand, meaning supply has overtaken demand for used EVs for the first time.
The report also laid bare the barriers to EV uptake, including a lack of choice and affordability. Used petrol and diesel cars under £30,000 outnumber electric vehicles on Auto Trader by five to one, and the company says a used electric car still costs roughly £10,000 more than an equivalent petrol or diesel car.
Auto Trader says these statistics have caused the company to change its forecast for when EVs will account for half of all new car sales. Whereas the company was expecting the crossover to happen in 2026, that has now been revised to 2027. By 2030, Auto Trader expects 90 percent of sales to be fully battery electric.
“Although current sales figures look positive, the rapid decline in consumer appetite for electric vehicles reveals the market is on thin ice where mass electric adoption is concerned,” said Erin Baker, the editorial director of Auto Trader. “And with the forecast of new car electric sales reaching 50% being pushed back to 2027 the market faces a precarious combination of factors which could cause major potholes on the road to 2030 without further action from government and industry to encourage mass adoption.
“There are some positive signs with running costs still in EVs favour, and more affordable models in the pipeline, particularly those from Asia. But today's slowdown in demand for EVs will translate into lower sales as we enter 2023.”