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Charging and tax anxiety are the last barriers to electric car adoption, opinion

Julian Rance, director of motor finance, Paragon

Paragon Bank managing director of motor finance Julian Rance believes a more coherent plan on developing the charging infrastructure, plus insight into the Government’s tax agenda, should propel electric vehicle (EV) adoption.

Read his 'guest opinion' article below to discover the reasons why.

The uptake of electric and hybrid vehicles in the UK is finally starting to gain pace. Until recent years, the momentum has been more akin to a steamroller than a Tesla-esque torque burst, but the segment is heading in the right direction.

The latest Society of Motor Manufacturers and Traders (SMMT) new car registration figures showed that 21,977 electrified cars were registered in February, up 123% on last year, earning a market share of over 37%.

In the first two months of the year, the strongest growth was recorded in battery electric vehicles, up 154% compared to 2021 at 24,850. With the new 22 plate coming in this month, I would expect those figures to continue to grow.

Chicken and egg

But any change in consumer behaviour never comes without teething pains and the perennial ‘chicken and egg’ debate around electric vehicle adoption and infrastructure still rages.

For me, barriers to adoption now centre on two main areas – charging anxiety and an unknown taxation regime.

As technology has advanced, fears over battery range have largely abated. Most electric vehicles now have a range in excess of what you’d get on a full tank of petrol. However, concerns over the charging network persist.

Most electric vehicle owners charge at home and use their vehicle to make short journeys. When it comes to making longer trips, the majority of owners will have some form of horror story about trying to find a charging point, waiting for one to become available and then being charged through the nose to use it.

The SMMT has urged the Government to take action on upscaling the charging infrastructure to facilitate further take-up of electric cars and has published a seven-point plan to turbocharge the UK’s infrastructure.

According to the SMMT, plug-in cars on the road grew by a phenomenal 280% between 2019 and 2021, but standard charge points increased by just 70% in the same period. Meanwhile, battery electric cars rose by a staggering 587%, whereas rapid/ultra-rapid charger stock grew by only 82%.

The industry body claims this is undermining consumer confidence to make the switch, and I would agree with this view.

Amongst its requests, the SMMT wants the Government to deliver a national plan to align charger provision with demand and to establish a new regulator, ‘Ofcharge’, to ensure charging is affordable, accessible and as easy as refuelling with petrol or diesel.

Other points include setting binding targets to ensure adequate public charge point provision and ensuring electricity networks are future-proofed and fit for purpose for zero emission mobility.

Government lobbying

It’s a welcome move by the SMMT, which recognises the benefits of developing an electric automotive industry to the UK economy and continues to lobby Government in that regard.

The issue for the providers of electric charging points is do they invest millions of pounds into infrastructure now when technology could soon overtake today’s offering? That could be holding back further infrastructure investment and I would like to see the Government offering further support in this space.

I would also like to see some firmer guidance from Government on what the tax treatment of electric vehicles will look like in the future. A decline in the use of petrol and diesel will leave a sizeable hole in the Treasury’s coffers and the Government will be looking at ways to raise revenue through electric vehicles.

Electric vehicles are currently tax-attractive but many drivers will want to see some form of clarity over how the Government intends to tax electrified cars in the future before making a purchase decision. That can’t be too far away.

The barriers to the adoption of electric vehicles are falling away and we are seeing motorists increasingly turning to electric alternatives. I believe fixing the charging infrastructure and delivering firmer guidance on tax will help accelerate adoption.

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