www.aftermarketonline.net MAY 2025 On the Road 52 Purchase incentives needed alongside more flexible regulation Industry focuses on taxing times for EVs John Shepherd reports from SMMT Electrified 2025, the UK auto industry’s conference on the zero emission vehicle transition, and ponders whether government policies risk running EVs off the road This conference was held in Westminster, literally within shouting distance of the Houses of Parliament, but are those who are inside the corridors of power really listening to industry concerns? If ministers were paying attention, they did nothing to stop the introduction just days later, on April 1, of major changes for rates of the road tax (vehicle excise dutyVED), which targeted electric cars — especially those costing more than £40,000. Previously, fully electric cars were exempt from VED. However, from ‘All Fools Day’ this year, EV buyers now have to pay £10 (the lowest rate of first-year VED) for the first year. The rate then moves up to the standard rate of £195 from the second year onwards. In addition, EVs costing more than £40,000 now attract a ‘luxury tax’. This additional tax adds another £425 to the cost of VED from the second year onwards, putting the price of taxing an EV up to £620 per year, with the expensive car supplement applicable for years two to six. However, the SMMT continues to urge ministers to act fast to convert Britain’s electric sceptics to the benefits of EVs, by using purchase incentives to stimulate greater demand. The keynote speaker at the event was future of roads minister, Lilian Greenwood. Credit to her for attending, although as she read through her speech, I couldn’t help thinking that there might be a mistake in her ministerial title. On this occasion, it might have been better to drop the reference to ‘future’, because she did not fully address ongoing and upcoming issues being debated at the conference. At one point, she did acknowledge that the cost of owning and producing an EV “is an issue”. But she also talked about efforts to build out the public charging network for EVs (to some audible groans from delegates about the paucity of the existing network and further rollouts). In a question-and-answer, the minister would also not be drawn on why EV drivers should pay more to charge up while ‘out and about’ than they would if they are fortunate enough to be able to charge up at home. The conference had heard that the cost of public charging can by three-to10times more expensive. SMMT brought together an impressive lineup of industry leaders including the CEO of the BMW Group UK & Ireland, David George. He noted that the cost of producing EVs was more expensive, especially when manufacturers faced fines of thousands of pounds for Cheaper to charge up at home than out and about
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