EV targets hit in first year – analysis

New analysis by the Energy and Climate Intelligence Unit (ECIU) of the Society of Motor Manufacturers and Traders’ (SMMT) data for new car sales for 2024 [1] has revealed that the car industry has met the sales target it was set in the first year of the Zero Emission Vehicle (ZEV) mandate, brought in under the previous government.
 
Analysis of vehicle CO2 data from the Department for Transport and the latest vehicle sales data from the Society of Motor Manufacturers and Traders (SMMT) reveals that the car industry has met the ZEV mandate target of 22% for 2024. This is because credits to hit the ZEV Mandate target are earned not just from the sale of EVs, but also from the sale of large numbers of low emission petrol and diesel cars – a flexibility worked into the mandate by the previous government that the car industry was in favour of. [2]
 
The sale of EVs takes the industry to 19.6%, with around a further 3% being earned from selling low-CO2 emissions petrol and diesel vehicles (exact results will be confirmed by the Government later in the year). [3]

Commenting on the analysis Colin Walker, Head of Transport at the ECIU, said: “In hitting the Government’s EV sales targets in their first year, the car industry has proven its ability to make the transition to building the electric vehicles of the future. 
 
“Suggestions that the car industry was struggling, and that the ZEV mandate target was too onerous, have proven to be wrong, and were often based on a misunderstanding of how the policy actually works. The previous Government, supported by the car industry, designed it to be achieved not only through the sale of EVs, but also through the sale of large numbers of low emission petrol and diesel cars.
 
“The mandate is encouraging greater competition between manufacturers as they seek to hit their targets. This drives prices down, to the benefit of British drivers, and sales of EVs up. Every new EV sold today will hit the second hand market, where most of us buy our cars, in around three to four years’ time. By expanding the pool of used electric cars the ZEV mandate will also help millions more families benefit from both cleaner and cheaper electric driving. 
 
“The mandate has provided certainty for investors to pour millions into the charging network and also British renewables which will provide the power. Any major changes would jeopardise future investment and jobs, particularly as the UK exports most of the cars we produce and those markets will increasingly demand electric, not petrol, vehicles.
 
“Some manufactures, like BMW, Mercedes and Hyundai, have exceeded their targets, while others, like Ford, have been slow to make the transition to EVs and have fallen short. For the huge numbers of people working in the UK’s automotive sector, a slow transition to EVs will put more of their jobs at risk.”
 
The competition between manufacturers to secure sales is driving down the sticker price for new EVs [4]. After 3-4 years, these new cars will enter the second-hand market enabling more households to access the cheaper running costs of EVs, given 80% of car sales in the UK are for used cars. Analysis by the ECIU has found that the best-selling second-hand EVs of 2024 could save their owners an average of £1,600 a year compared to their petrol equivalents. [5]
 
A recent report by CBI Economics, commissioned by the ECIU, revealed that a failure by the car industry to make the transition to manufacturing EVs could see its contributions to the UK economy fall by as much as 73%, or £34.1bn, and over 400,000 jobs could be lost. Conversely, economic output could increase by over £16bn, and 167,000 new jobs could be created, if a rapid and successful transition takes place. Government support is critical in avoiding such an outcome, and this includes the provision of a stable and supportive regulatory environment through keeping measures like the ZEV Mandate in place. [6]
 

ENDS

Notes to editors:
 

1. Final car sales data for 2024 will be available on the SMMT website as of Monday 6 January 2025.   Total new car sales reached 1.953million, including 382,000 BEVs i.e. BEVs had 19.6% market share in 2024.

2. https://www.gov.uk/government/consultations/a-zero-emission-vehicle-zev-mandate-and-co2-emissions-regulation-for-new-cars-and-vans-in-the-uk/outcome/zero-emission-vehicle-zev-mandate-consultation-summary-of-responses-and-joint-government-response 

3. The analysis of performance against the ZEV Mandate’s car target was conducted in two parts: sales of new battery electric vehicles (BEVs i.e. pure electrics); and improved fuel efficiency of new non-BEVs (internal combustion and all types of hybrids).  SMMT data for the full year 2024 shows that BEVs made up 19.6% of new car sales.  Non-BEV sales made up 80.4%, and the weighted average emissions for these new non-BEVs is translated into ‘credits’ (as per the ZEV Mandate legislation) to reach a contribution of around 3%, with the exact value depending on final emissions data to be confirmed by the Government.  Taken together, BEV sales and improvements in non-BEV fuel efficiency mean that car manufacturers overall are set to meet the target of 22% for 2024.

4. https://www.thetimes.com/uk/transport/article/electric-car-prices-discount-7dwnhn2x6 

5. https://eciu.net/media/press-releases/2024/best-selling-second-hand-evs-saving-drivers-1-600-a-year

6. https://www.cbi.org.uk/media/qoxp3pn4/cbi-economics-eciu-ev-sector-report-2024.pdf

For more information or for interview requests:

George Smeeton, Head of Communications, ECIU, Tel: +44 (0)7894 571 153, email: george.smeeton@eciu.net