Out of all the industries in the UK at the moment, the automotive industry is subject to a lot of commotion, with particular attention to the electric vehicle industry. The industry is really feeling the pressure as record-breaking fuel prices disturb the market.
Combined with stellar marketing campaigns by electric vehicle big dogs such as Tesla, and new DVLA restrictions for plate changes – and you have yourself a market which is seeing an uptick of 79% in Electric Vehicle sales. A major win for the Earth, but an extra hurdle and cost to new-time buyers looking to buy used cars.
For car dealership owners, the change of direction towards electric vehicles and their higher pricing points will in turn positively affect the leasing and renting industry.
What is happening in the electric vehicle market currently?
Sales of electric vehicles (EVs) are booming against an overall backdrop of declining new car registrations, according to the latest industry data.
Compared with the same period last year, BEV sales were up almost 79% to more than 39,000 units, with Tesla models responsible for about a third of these sales.
Rising energy costs, fuel costs, inflation and a squeeze on household incomes have an effect on future demand. The link between the record-breaking fuel costs in March is very noticeable, “Our figures show that when there are issues with petrol and diesel cars, interest in EVs rise.
For example, when petrol prices hit record highs in March, searches for EVs on our site rose 37% in a week” say SMMT.
It is a turbulent time to be a manufacturer of anything but pure or hybrid vehicles, with petrol vehicle purchases down 29%.
However, the silver lining to all of this is that manufacturers are aware of these changes and are prioritising EV manufacturing, so you can expect shorter wait times for EV vehicles, compared to petrol.
What does the government have to say about the rising demand for electric vehicles?
The government are here for the migration away from Petrol and diesel vehicles, as they have invested £1.6 billion in a bid to build a nationwide network of 300,000 public electric vehicle (EV) chargers by 2030. This is a tenfold increase on the current 30,000 charging stations.
At present, there are an estimated 60,000 fuel pumps on UK roads. This investment also includes plug in hybrid charging points, single charge points and rapid charging points.
With heavy fuel duties in cities and diesel cars being slowly phased out by councils, the future of vehicles is looking to be powered by electric power.
What do plate changes have to do with electric vehicles?
The DVLA announced the changes as a new batch of 2022 registration have been launched, as of March the 1st 2022. Designed to make plates more resistant to wear and tear and easier to track with surveillance equipment, the new plates are set to be a little bit different. They are to be made with tougher material.
“You could be fined up to £1,000 and your vehicle will fail its MOT test if you drive with incorrectly displayed number plates.” says the DVLA.
The plate changes are:
New Union Jack, not EU flag
This plate change adds an additional cost on used cars, as the vehicle was registered to an old plate. While new vehicles will be automatically compliant with the plate changes. Inevitably, following the data, this means that more people will look to buy a new car, and that is likely to be an electric one.
James Fairclough, CEO of AA Financial Services, commented on the car market in 2022. “The promise of fresh car demand in 2022 is welcome news, following a challenging year for the car industry. The economic uncertainty of Covid and the transition to electric cars will continue to influence drivers.”
What do electric vehicles for car dealerships?
The rising prices of fuel and ease of access to more charging points mean car dealerships have to re-evaluate their business plans. For most, the plate changes and fuel costs mean petrol cars will keep decreasing in demand as more people save for new electric vehicles that comply with DVLA standards.
Currently, electric vehicles are produced at a lower rate worldwide, meaning their price point is higher. While they are cheaper to run throughout ownership due to getting rid of fuel – this initial cost is a barrier. Leasing and renting electric vehicles allows them to be affordable.
We have seen the effects ourselves, as some of our car dealership customers have had a significant uptick in their BEV leasing numbers.
Octopus Electrical Vehicle services are a customer of Signable and have recently seen the demand for their leasing service of electric vehicles go up dramatically.
On the paperwork side of things, this means they have had to have a system in place that has allowed them to keep up with quick demand and also will enable them to move through the process fast enough to lease cars like clockwork.
They have three different environmentally friendly tiers of cars for their customers – which means several different types of contracts are needed at all times.
Through Signable, they have been able to scale quickly and provide exemplary service to hundreds of businesses that wish to change their company cars to electric ones.
Be at the forefront of electric vehicles with Signable, and have a plethora of features at your fingertips to allow customers to hire EV vehicles off you in minutes.
Leasing contracts, sales contracts etc., the process can be painless for your automotive customers when it comes to electric vehicles.