Is now the time to go electric?

In recent weeks, much has been discussed about the decline in demand for electric vehicles, particularly among private buyers. While overall sales figures may appear strong, many EV registrations are being driven by fleet and business purchases, largely due to the tax breaks and benefits available to electric company car drivers. For private buyers, however, the removal of most subsidies and grants has reduced the incentive to switch to electric vehicles.

Another drawback to owning an electric car is the high upfront cost. Even though the value of an EV can depreciate significantly within the first 12 months, the initial purchase price is often much higher than that of a comparable petrol or diesel model. In the past, this was balanced by lower running costs, but with the recent rise in utility bills and the Cost of Living crisis, that gap is shrinking. In some cases, depending on where, when, and how you charge the vehicle, it could even end up being more expensive to run.

Why Buy An Electric Car Now?

Now could actually be an ideal time to consider buying an electric vehicle. With the upcoming 2035 ban on combustion engines, the government has introduced the ZEV (Zero Emission Vehicle) Mandate, setting strict targets for manufacturers to meet. This year, for instance, 22% of all cars sold must be fully electric. Manufacturers who fail to meet these targets could face steep financial penalties, with fines reaching up to £15,000 per vehicle.

As a result, the combination of declining demand and pressure on manufacturers to boost electric vehicle sales has led to significant discounts and offers. Many automakers are lowering prices to attract potential buyers, with up to 7 out of 10 new electric vehicles seeing price reductions. To avoid heavy fines, the industry is working to create demand by cutting prices—some by as much as 20% year-on-year, as seen with certain models on platforms like Auto Trader. Tesla, for instance, has repeatedly reduced the prices of its electric range over the past year. In addition to price drops, many manufacturers are also offering extra features or packages at no additional cost to make their electric models more appealing.

However, with fewer than 1 in 10 private buyers currently opting for fully electric vehicles, it remains to be seen whether these incentives will boost demand enough to sway drivers still using combustion engines. By shopping wisely and doing your research, you could not only secure a substantial discount on a new electric vehicle but also find one that may depreciate less rapidly than others on the market.

Is Electric Car Interest Growing?

According to data from Auto Trader, two-thirds of UK drivers opt for used cars, and with some electric models experiencing significant depreciation in their first 12 months, convincing them to buy new EV's may prove challenging. However, their research indicates that 34% of buyers are now considering an electric vehicle for their next purchase, up from 26% in August last year. Among wealthier buyers, who may be less concerned with the upfront cost, this figure has risen from 47% in 2022 to 61%. Younger drivers, particularly those aged 17 to 24, are the most likely to consider an EV, with 63% expressing interest in making the switch.

The initial cost and affordability of electric vehicles remain major obstacles for many, not only for new cars but also for used ones. Currently, there are just 9 new electric models available for under £30,000, compared to 76 combustion engine models. For used cars, the average price of a 0-5 year old electric vehicle on Auto Trader is just over £28,500—more than £7,500 higher than comparable petrol or diesel cars.

More options than ever

For those looking to purchase a car above that price point, there has never been more variety, with many familiar brands now offering electric options. While Tesla was an early leader in the EV market, mainstream manufacturers are now providing strong alternatives. Volvo’s sister company, Polestar, continues to innovate, with the Polestar 2 emerging as a key competitor to Tesla’s Model 3. The newly unveiled Polestar 4 SUV is also giving potential Model Y buyers pause for thought.

Porsche, already known for its popular Taycan, recently announced that the 2024 Macan will be fully electric, with the Boxster and Cayman expected to follow suit. Land Rover has entered the electric space with the upcoming Range Rover EV, offering the brand’s trademark luxury and off-road capability in a landmark electric model. Lotus, after making the Emira its final combustion-engine car, is expanding its EV lineup with the Eletre performance SUV, the limited-production Evija hypercar, and the newly launched Emeya luxury performance saloon—bold departures from their traditional models, but making a strong impact in the EV market.

The German trio of BMW, Audi, and Mercedes-Benz also offers some of the finest electric vehicles available, providing customers with models they trust, alongside their petrol counterparts. Many have ensured that the electric versions of their mainstream models are priced similarly to their combustion engine variants, making lifestyle and commuting needs—rather than affordability—the key factors in deciding between the two.

See What Is On Offer

With advancements in technology, extended range capabilities, a growing selection of models, and continuous improvements in the public charging network, now is an ideal time to consider an electric vehicle. Coupled with the pressure on manufacturers to meet government targets for EV sales, it’s also more affordable than ever. Whether you're looking for discounts on the list price, complimentary upgrades or optional extras, or even a free or discounted home charger installation, shopping around can reveal excellent deals from various brands.

Approved Electric Car Finance

At Approved Motor Finance we have your next car’s funding sorted, whether it is electric or however it is powered. Our expert Account Managers use our panel of over 125+ specialist lenders to help you to find the perfect package, bespoke to you and your circumstances. Our team are always on hand should you have any questions about arranging car finance and your dedicated Account Manager is ready to take your call today.