BLOG Promising but still tiny electric vehicle sales: Government targets are unrealistic
The used car market has seen a huge surge in consumer demand over the past year, fueled in part by the growing number of people who believe owning a car is more important than before COVID, and one on ten plans to buy a new car to avoid public transport. On our marketplace, traffic increased by almost 30% compared to 2019, with monthly visits jumping to around 64 million.
It’s easy to forget that physical forecourts were closed for more than three months last year and just as the market was returning to some semblance of normalcy, the global shortage of semiconductor supply hit very hard. the supply of new cars and with a quick and profound knock on effects on the used car market. Even with increased demand, such performance is remarkable.
I am confident that 2021 will be remembered as a defining year for the used car market, as we have seen that the steps it has been forced to take to embrace digital solutions have paid off. In the final weeks of the lockdown, retailers often reached around 90% of normal sales volumes.
The hit to new car sales and chip shortages have sent prices soaring, with five years of growth squeezed into just seven months. With new car supply challenges set to last at least until the middle of the year, the effects will be felt over the next few years as younger vehicles become increasingly scarce. We believe the pandemic resulted in the loss of 1.5 million new car sales. There are already a third fewer used cars under three years old available for purchase this year than there were in 2019. With no sign of easing demand levels, price growth won’t slow significantly anytime soon and we may have to get used to our cars as valuable assets.
The rise of electric vehicles is promising, and in our market, used electric vehicles are now selling faster than any other type of fuel. However, EVs still represent a tiny fraction of the market as skyrocketing prices and concerns about battery degradation continue to limit even the market for used EVs to all but the cheapest car buyers. richer. The government has admirable goals, but it’s hard to see how they can be achieved when it cuts incentives and even raises the prospect of a road-use charge for electric vehicle drivers.
As we saw with the diesel policy flip-flop, the result is confusion and inaction on the part of car buyers. We urge the government to learn from the past and not put the cart before the horse.
