UK Plugin EVs Hit 23% in March, Full Electrics Up Over 2× YoY

The UK auto market saw plugin electric vehicles take 22.7% share in March, up strongly from 13.5% year on year. Overall auto volumes were 243,749, down some 45% from the seasonal norms of the pre-pandemic years. Tesla’s Model Y and Model 3 are the 6th and 7th best selling autos in the UK so far in 2022.

March’s combined plugin result of 22.7% comprised 16.1% full battery electrics (BEVs) and 6.6% plugin hybrids (PHEVs). This strong BEV weighting has continued over recent months.

BEVs’ 16.1% share is up more than double YoY, from 7.7%. Meanwhile PHEVs’ 6.6% share is barely changed compared to the 6.1% of March 2021.

Diesel-only share has once again fallen under 6%, and will now likely remain there (and falling) in the future. Meanwhile, auto makers’ emissions reduction efforts in the UK are still targeting the low-hanging fruit of “mild hybrid” and HEV technologies, which are only temporary steps on the journey to full electrification.

UK’s Favorite BEV Brands

March again saw Tesla make its end-of-quarter logistics surge, with the Model Y and Model 3 taking the UK’s top seller spots in the overall auto market. They are also doing very well in the year-to-date rankings:

SMMT UK Best Selling Autos / Image Source: SMMT

Let’s have a look at March’s favourite BEV brands in the UK market. Obviously Tesla is way out in front, with over a third of all of the UK’s BEV sales:

Although March is a particular logistics peak for Tesla, making the monthly chart look extreme, the trailing 3 months chart also confirms the brand’s steady dominance in the UK market, with almost a quarter of all BEV sales. That’s a big gap from nearest rival Kia, which captured just under a tenth of sales:

If we take a further step back and look at the relative performance of manufacturing groups in the UK market over the past 3 months, Tesla still leads, but the competition is relatively closer. Volkswagen Group and Hyundai Motor Group are closely competing for the #2 and #3 spots.

Outlook

The UK industry body, the SMMT has summarised the current headwinds that auto sales in the UK market are facing:

“With the industry reporting strong order books, it is the constraints on supply that are preventing the sector from moving into full recovery. The shortage of semiconductors, itself an effect of the pandemic, is affecting the sector globally but longer-term uncertainty remains, with the invasion of Ukraine raising risk to supply chains. More broadly, however, economic headwinds such as rising energy costs, fuel costs, inflation and a squeeze on household incomes could impact new vehicle demand. ” (SMMT press release, April 2022).

This is wholly expected, and something I’ve already mentioned in my recent reports for Sweden, Norway and France. The unanswered question as yet is whether the “risk to supply chains” for BEV specific manufacturing will be impacted more or less than that for combustion autos. It may be a while before the overall picture on supply constraints becomes clear.

With rising road-fuel prices, BEVs’ relative demand (vs. ICE) will be strengthened. The supply of BEVs is, as ever, the weak point. Expect customer waiting lists to continue to rise for all brands. Tesla’s manufacturing capacity is closest to its demand levels (though still with several months of waiting time). Other manufacturers are so far behind in manufacturing capacity that customers are waiting over a year for vehicle delivery, in some cases. This obviously helps funnel shoppers to “faster” manufacturers, able to deliver in Europe within a matter of months, as Tesla is.

Overall I expect plugin share, and especially that of full BEVs, to continue to climb strongly throughout 2022, even if actual sales volume growth is less dramatic, due to weak manufacturing ramp up, and the current supply chain crises.

What are your thoughts on the UK and European auto market? Please join in the discussion in the comments section below.