Record-breaking year for electric car sales, but overall market flat

One in six new car registrations in 2021 was a plug-in, electrified vehicle, compared with one in 10 the previous year, creating a growing chasm between electric vehicle adoption and the infrastructure with which to power EVs. New data from the Society of Motor Manufacturers and Traders showed that 305,000 plug-in vehicles (electric vehicles and plug-in hybrids) were sold last year, accounting for 18.6% of overall market share. Including non-plug-in hybrids, 27.5% of the market is now electrified. In 2020, electrified cars had a market share of 17%. Electric vehicles accounted for 11.6% of the market, or 190,727 units. It means that more EVs were registered last year than over the previous five years combined. For Autocar Business webinars and podcasts, visit Autocar Business Insight SMMT CEO Mike Hawes said: “It’s very good news on the plug-in front but we can’t afford to be complacent. Other competitor markets are growing just as quickly, and sometimes even faster than us. “There’s a long way to go to reach net zero. Around one in 100 vehicles on the road is a plug-in. The government’s ambition is that, by 2030, we need to get that to one in three.” He continued: “It shows how much we need to accelerate sales. It’s not by lack of want from the manufacturers. There are now 140 plug-in vehicles available with another 47 expected this year. “The biggest obstacle to our shared net zero ambitions is not product availability but cost and charging infrastructure. Recent cuts to incentives and home charging grants should be reversed and we need to boost the roll-out of public on-street charging with mandated targets, providing every driver, wherever they live, with the assurance they can charge where they want and when they want. “With the increase in EV sales and much slower increase in provision of on-street charging, the gap is getting worse.” Overall market flat The overall car market has improved fractionally over 2020, but only by 1% or 16,117 units. In 2020, 1.63 million cars were sold, while in 2021 it was 1.65 million. Hawes commented: “2020 was the worst year for car sales since 1992 - 2021 is the second worst year since 1992. It is not a fabulous picture by any shape or form.” He added: “It’s been another desperately disappointing year for the car industry as Covid continues to cast a pall over any recovery. Manufacturers continue to battle myriad challenges, with tougher trading arrangements, accelerating technology shifts and, above all, the global semiconductor shortage which is decimating supply. “Demand is still strong. The challenge is how you maximise your ability to supply customers when supply is so heavily challenged.” While sales of plug-in vehicles have grown massively, petrol remains by far the most popular power source, with a 58.5% market share. Diesel accounted for 16.0% of registrations, still outperforming electric vehicles for now. Superminis remained Britain’s most popular cars, with 513,000 registrations, followed by the lower medium (449,000) and dual-purpose (443,000) segments. Fleet and business sales took over just half of overall registrations compared to private buyers, but compared to 2020, the share of private buyers increased by 7.4%, while businesses and large fleet registrations fell by 4.4% and 4.7% respectively, in part due to supply shortages. Vauxhall beats Ford to the top spot The Vauxhall Corsa was the top-selling car of the year with 40,914 units registered, and sees a new brand at the top of the standings for the first time in 50 years. The electric Tesla Model 3, an unexpected candidate, came in second place followed by the Mini hatchback. The Ford Fiesta, which has topped the charts for a number of years, is nowhere to be seen in the top 10, restricted by supply issues caused by the semiconductor shortage. The only Ford car ranked in the top 10 is its popular Puma compact SUV in eighth position. A Ford spokesman told Autocar: “In 2021, semiconductor shortages meant we prioritised commercial vehicles, customer orders and newer products like Puma and Kuga, and have consequently sold less of our traditional models like Fiesta and Focus. “As is evident from our passenger range, it is becoming far more focused around sports utilities, with around 64% of all our passenger vehicle sales across Europe in the third quarter being SUVs.” Of the more mainstream manufacturers, Ford, Jaguar and Renault were hardest hit, falling 23.57%, 26,05% and 30.19% respectively compared with the previous year. While Ford might look to be in bad shape in terms of car sales, in reality it’s the top-selling manufacturer when you combine car and van sales. In fact, while the Corsa tops the car rankings, the Tourneo Custom van is the best-selling vehicle of 2021, selling 54,000 units compared with the Corsa’s 40,914 units. Plus, Ford vehicles accounted for one-third of all commercial vehicles sold in the UK. Meanwhile, Hyundai, Kia and MG showed impressive year-on-year growth, increasing registrations by 46.67%, 28.75% and 66.70% respectively. A Kia spokesman said the success was “a result of good supply and strong product”, identifying the continued success of the e-Niro and Sportage, alongside the introduction of the updated Kia Ceed and new Kia EV6. Hyundai UK managing director Ashley Andrew commented: "Despite continuing market and industry challenges, we are pleased to have seen some positive signs of recovery in 2021 resulting in a record car market share for Hyundai UK. This has been driven by the strength of our new product line up which extended our alternative fuel offering even further, our ability to maintain a level of supply and the performance & support of our dealer network. 2022 may well bring further challenges but we believe we have the products, the people and the network to continue the trajectory.” The Model 3 is the best-selling electric car, with the Kia e-Niro and Volkswagen ID 3 placed second and third respectively. (For a full rundown of the best-selling cars, plus electric vehicles and plug-in hybrids, see below.) Predictions for the year ahead and beyond SMMT predicts sales of 1.96 million for 2022, an increase on this year but nowhere near what it considers a ‘normal’ run rate of 2.25 million to 2.3 million. Hawes said the pressures from the semiconductor shortage are expected to ease as the year goes on, but are likely to run into 2023, adding that “different brands are affected to a greater or lesser extent, depending on their relationship with semiconductor suppliers”. He commented: “We can’t lose sight of just how tough it is for the industry. These are significant drops from where we should be. Semiconductors are the major challenge - vehicles use between 1500 to 3000 semiconductors. When car makers can’t get them, they mitigate - focusing on high-margin vehicles. But they also need to hit CO2 targets, which means allocating supply to electric vehicles. It’s one reason why EVs have performed so well.” Full import controls, as a result of Brexit, are also now in place. Hawes said: “It’s too early to say, but we don’t see any major problems bringing vehicles and goods through ports. That’s partly because the industry spent a huge amount of time preparing for this. “The current shortage of vehicles is not Brexit-related, and the EU still remains the biggest market despite Brexit. We got a deal that just about worked for the industry. We’re avoiding tariffs, we’re avoiding quotas, although it is more administratively burdensome. “It’s a highly distorted market because of the semiconductor crisis, but we’re operating under the new Brexit regime with additional costs and there is more to be resolved; for example, a permanent type approval for vehicles.” Top 10 cars overall 1. Vauxhall Corsa 2. Tesla Model 3 3. Mini 4. Mercedes-Benz A-Class 5. Volkswagen Polo 6. Volkswagen Golf 7. Nissan Qashqai 8. Ford Puma 9. Kia Sportage 10. Toyota Yaris Top 10 electric vehicles 1. Tesla Model 3 2. Kia e-Kia Niro 3. Volkswagen ID 3 4. Nissan Leaf 5. Audi E-tron 6. Hyundai Kona Electric 7. Mini Electric 8. Renault Zoe 9. Vauxhall Corsa 10. MG ZS Top 10 plug-in hybrids 1. BMW 3 Series 2. Mercedes-Benz A-Class 3. Volvo XC40 4. Ford Kuga 5. Audi A3 6. Range Rover Evoque 7. BMW X5 8. Volvo XC60 9. Range Rover Sport 10. Seat Leon