UPTAKE of hybrid electric vehicles (HEVs) reached record levels in March, rising by 19.6% to 44,550 units and 14.0% of the market, while the biggest percentage growth was recorded by plug-in hybrids, up by more than a third to 24,517 units, or 7.7% of all new registrations.

Conversely, while battery electric vehicle (BEV) registration volumes were at their highest ever recorded levels, market share fell by one percentage point from the same month last year, down to 15.2%. Registrations rose 3.8%, with only fleets showing any volume growth.

The fall in BEV market share within a growing market underscores the need for government to support consumers to speed up fleet renewal. Large fleets continue to drive BEV uptake, thanks to compelling tax incentives but while registration volumes increased in March, market share declined. A tough economic backdrop makes it ever more challenging for consumers to invest in these new technologies.

Manufacturers themselves are offering generous incentives, helping more drivers switch to zero emission vehicles and deliver government and industry carbon targets, but this cannot be sustained indefinitely. A full market transition needs incentives not just for fleet and business buyers but private retail buyers as well, something that would bring the UK into line with other major markets.

Temporarily halving VAT on BEVs, revising the threshold for the expensive car supplement on Vehicle Excise Duty next April, and abolishing the ‘pavement penalty’ on public EV charging by equalising VAT rates to 5% in line with home charging, would make a significant difference to consumers, helping more of them move to zero emission vehicles sooner.

Mike Hawes, SMMT Chief Executive, said: “Market growth continues, fuelled by fleets investing after two tough years of constrained supply. A sluggish private market and shrinking EV market share, however, show the challenge ahead. Manufacturers are providing compelling offers, but they can’t single-handedly fund the transition indefinitely. Government support for private consumers – not just business and fleets – would send a positive message and deliver a faster, fairer transition on time and on target.”

Overall, the new car market clocked up its 20th consecutive month of growth in March, with a 10.4% rise in registrations.

In what is typically the busiest month of the year due to the new numberplate, 317,786 new cars reached the road with a 24 plate – the best March performance since 2019, although still 30.6% below pre-pandemic levels.

Growth was again driven by fleet investment, up 29.6% as the sector continues to recover following the constrained supply of previous years. Registrations by private buyers fell by 7.7%, with a challenging economic backdrop of low growth, weak consumer confidence and high interest rates. The small business registration segment, meanwhile, declined 8.0%.

Kim Royds, Mobility Director at Centrica, said: “The launch of the new number plate has seen an uptick in new car registrations, particularly within the electric vehicle market. EVs have continued to increase their market share since the start of the year as more drivers reap the benefits of going electric. The challenge now is to encourage all motorists to make the switch.

“To do this, we must tackle the inequality that exists between at home and public charging. A significant number of homeowners don’t have access to a driveway and are therefore restricted from ease-of-use charging solutions to make their electric dream a reality.  Creating at home and kerbside charge point solutions with affordable charging costs must be a priority for industry leaders and policy makers to ensure that nobody is left behind.”

Nick Williams, Managing Director at Lex Autolease, added: “The news of declining electric car sales among several manufacturers is indicative of the evolving global landscape of electric vehicle adoption and the challenges in encouraging drivers to switch, but we remain optimistic about the future of the UK market.

“This will be a pivotal year as manufacturers react to the ZEV mandate and appetite for adoption in the UK grows. Our latest data shows that all businesses with fleets plan to become fully electric in an average of four years and two thirds of 17–35-year-olds are planning to make their next car electric, with fewer seeing costs as a barrier compared to their parents’ generation.

“But there is still work to be done to put the UK on a path to universal adoption. Concerns about charging infrastructure endure and we encourage policy makers to make a concerted effort to allay them with a rapid and fair rollout that meets demand, alongside continued commitment to the ZEV mandate, clarity on Benefit in Kind rates beyond 2028, a national battery strategy to support the development of the UK battery manufacturing industry and better information on the benefits for would-be EV drivers.”