Hello and welcome back to The Fast Charge, a British EV newsletter.
For today’s final edition of 2022, I recap the last year and highlight four key trends for 2023, including insights and predictions from seven EV leaders. A bit further down, the latest news in brief.
Thank you for continuing to read The Fast Charge each week, it will return to your inbox on Tuesday 10 January 2023. Wishing everyone a Merry Christmas and a Happy New Year in between!
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Seven EV leaders predict 2023 trends
One year ago, I described 2021 as the ‘pinnacle year’ for clean transport. And, looking back, it really was. We witnessed multiple governments announce bans on combustion engines, carmakers revealing transition plans, masses of investment, COP26, SPACs galore, and a raft of new innovations hitting the scene. By comparison, 2022 has been significantly more challenging.
The EV sector is no longer a niche area. On UK roads alone, there are now over 600,000 fully electric cars – an increase of 50% compared to last year. This means about 550 new EVs have arrived with owners each day in 2022.
This surge in ownership has brought fresh challenges. For the government, they have had to recognise that there needs to be protections for drivers making the switch, particularly on reliability and user-friendliness. This arrived in the form of March’s Infrastructure Strategy – but they also have hit the brakes financially. While there remain sums available for charging network growth, this has hit barriers with some authorities, meanwhile, the Treasury stamped down firstly on car grants, and in Autumn announced an EV road tax from 2025.
All of this has happened as Putin’s war in Ukraine and a global economic upturn has sent energy prices and inflation skyrocketing – which has consistently put pressure on manufacturers, chargepoint operators, energy providers and, as a result, EV owners’ wallets.
The year ends with some of Britain’s early EV leaders, like Britishvolt and Arrival, seeming all but dead. And, due to increasing prices, data from Auto Trader last week revealed a falling interest in searches for EVs – from 27% in the Summer to 19% at the end of the year.
But there is much to be hopeful for in 2023. There remains a huge number of people jumping into EVs and, compared to last year, there’s never been more choice of models (new and used), chargers or support structures to make that journey easy.
Evidently, there’s still a long way to go and, as the past year shows, you can never know what’s around the corner. This is why I have highlighted four key trends, including insights from seven leaders and experts from across the EV industry, that will be crucial in 2023.
New focus on affordability
The majority of early EV adopters have been homeowners with higher-than-average incomes. As a result, carmakers have understandably produced models that target this bracket – which is why there are so many electric sedans and SUVs.
However, this population is only so big, and the new cars aimed at them are about 36% more expensive than their petrol or diesel equivalent. This remains the case even when second-hand, where EVs are £10,000 more than their internal combustion counterparts.
Ginny Buckley, founder and CEO of Electrifying.com, wants to see more affordable cars heading to consumers in 2023. “The lack of EVs at an affordable price point is having a detrimental effect on mainstream consumers,” she says. “Sadly, what we’re more likely to see is an increase in larger, premium EVs with bigger batteries as these command a higher profit margin, making it easier for car makers to swallow up the added costs of EV production.”
Buckley is not alone in her belief that affordable options are needed to get more people into EVs. Ian Plummer, Auto Trader’s Commercial Director, suggests the fact that EVs don’t seem cheap is “a significant pothole on the road to 2030.”
Plummer believes “urgent action” is required to drive the adoption of EVs beyond just the most affluent who can afford the ‘green premium’. “Education and transparency will be key to overcoming barriers to entry, and the entire automotive industry will need to come together to play a vital role in demystifying EVs, especially in informing car buyers on potential [total cost of ownership] savings, growing range potential and expanding re-charging solutions.”
However, while Auto Trader’s data suggests interest may have fallen and that the economic pressures on consumers will undoubtedly carry on into next year, the clean transport research group, New AutoMotive, predicts the EV market share will continue to grow.
“Our modelling suggests that one in three new car sales will be fully electric within the first six months of the new year. However, it is not as certain that the actual volume of electric cars sold over 2023 will increase compared to 2022,” says Ben Nelmes, CEO of New AutoMotive.
The looming recession is the likely obstacle in the way of greater volumes of EVs hitting roads in 2023, according to New AutoMotive. Though, Nelmes suggests this will likely impact all car registrations. “We have seen in 2022 that EV sales are somewhat insulated from these trends, with fossil fuelled car sales taking most of the blow of these contractions. This will likely also be the case in 2023, meaning EVs could claim a larger share of the market, despite limited increases to the actual volume of EV sales,” he adds.
Key outtake – New focus on affordability by carmakers in the face of recession, even if in all likelihood the growing market will still be made-up of luxury models.
Asian brands soar into the UK
The past 12 months have seen the entrance of several Asian car brands into Europe. According to Dan Caesar, CEO of Fully Charged, this could begin to squeeze more traditional brands – as they can undercut significantly on pricing.
“The two things we expect to see in the UK in the next 12 months are, the rapid introduction of Chinese-made cars, whether that’s stealth brands like MG or – spurred by Biden’s trade barriers – the accelerated arrival of BYD and company,” says Caesar, adding “we also anticipate further growth of the electric market leader (Tesla) and the Korean challenger brands (Genesis, Hyundai and KIA).”
Auto Trader also acknowledges this trend several times in its latest ‘Road to 2030 Report’, with Erin Baker, Auto Trader’s editorial director, calling out “Asia” twice in her concluding remarks as being where affordable EV models will likely come.
From his perspective running Fully Charged, Caesar suggests “the flipside of this is that some famous names, especially those with more expensive EVs, are really set to feel the squeeze. And when we host our 1st global, consumer-choice awards in Amsterdam next November, the most telling thing will be those brands that are not in the room. Big change is inevitable.”
In my own view, I have no doubt Asian – especially Chinese brands – will continue to pour into the UK marketplace at an increasing pace in 2023. However, it will be interesting how both Conservative and Labour politicians react.
Key outtake – Expect to see Asian EV brands continue to rapidly grow or launch in the UK, though be prepared for political reaction if it looks likely to affect British manufacturing.
Charging networks fight back
“Inflation is as violent as a mugger, as frightening as an armed robber, and as deadly as a hit man,” complained Ronald Reagan, and it quite vividly describes how most British consumers have probably felt in 2022. Inflation – both for goods, energy and services – is at the highest rates it’s been for decades. And it’s had a huge impact on the EV sector, particularly the cost of charging.
Jim Holder, Editorial Director of Haymarket Automotive (which publishes What Car? and Autocar), believes the cost of charging an EV versus a petrol or diesel car will remain a “biggie” in 2023.
“It's an easy headline that has already been exploited, and if the energy crisis continues I can see it gaining more traction and would-be buyers going back into a holding pattern, waiting to see what happens rather than committing to electrification,” says Holder.
But not just prices, throughout 2022 the importance of charging networks simply working properly and easily has repeatedly been underlined by drivers. In response, in March, the government promised there to be 99% reliability – which we are still waiting for, though they could be published as soon as today.
James Court, CEO of the EV Association for England, believes once they arrive the new rules will make a positive impact in 2023. “I think the next twelve months we’ll see EV drivers starting to see the benefits of the new consumer regulations, meaning more reliability and confidence in charging points which is a real game changer.”
Holder agrees public charging experience will “continue to come under the spotlight”, but believes this may be the year that the big operators fight back – both in terms of their geographical spread and their uptime and reliability data.
“It feels to me that there's increasingly two tiers of providers (possibly three or four) and that the biggest need to leverage their presence to build reassurance, as well as giving their brands greater value.”
Some operators are already biting at the heels to meet this challenge. Tom Hurst, the UK Country Manager for the rapid charging network Fastned, claims they (and other networks) are ready to invest millions. However, he feels poor planning rules are hindering the process.
“With a fast-growing number of EV drivers and calls for more stations – I expect the planning process to be front of mind for [chargepoint operators] in 2023,” says Hurst.
He adds: “We’re ready to invest millions in the UK but cumbersome planning regulations are slowing us down – and worse, not making enough space for the type of charging experience drivers deserve.”
Key outtake – Next year could see charging networks strike back, they will certainly have a bar to aim for when the government publishes its regulations. However, energy prices will continue to prove a challenge.
Fresh debate on the car’s future
When I started this newsletter, I was rather suspicious of micro EVs like the Citroen AMI. But this year has proved they can be game-changers, especially as both the sustainability and suitability of cars in the modern era continue to be questioned.
As such, next year, we may see more people start rethinking our whole approach to future EV ownership – such as car design. Electrifying.com certainly thinks so.
“We expect to see an increased focus on sustainability and circularity across the car industry,” says Ginny Buckley.
“Cars like the Citroen Oli, which we’ve just awarded our coveted Green Hero award to, point the way for a car industry that needs to become more aware of the overall carbon footprint of its vehicles rather than focussing on local emissions from the tailpipe.”
Buckley isn’t alone. Jim Holder also believes EVs like the AMI could start a conversation about how much resource is needed to transport people. “I don't under-estimate the huge cultural shift that it would take, or the obvious upsides of larger cars, but I do wonder if mission-specific cars (or vehicles) might become more pertinent, especially in straightened, more environmentally conscious times.”
My own view is similar, the environmental cost of creating an EV remains one of the number one challenges to the sector and we don’t talk about it enough. Likewise, there is a risk that switchers default to replacing their internal combustion engines for an EV, without even considering other suitable mobility options, such as e-bikes, if we’re not careful.
Key outtake – As pressures on supply chains remain and sustainability continues to stay important to all audiences, expect new innovations around the circular economy in 2023, from new EV models, to energy management and batteries.
Thank you to all those who contributed, and please do let me know if you agree, disagree or have a totally different prediction for 2023!
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Last week in brief…
H2 COMMITTEE: The House of Commons Science and Technology Committee published a report on the use of hydrogen in the UK economy. While they acknowledged it could undoubtedly help industrial sectors to decarbonise, on passenger cars they said electric has “a clear lead over other green alternatives, including cars powered using hydrogen. In the near future, hydrogen’s role in this area is likely to be small.” See Twitter thread.
IDIOT ELON: Musk polled Twitter users on whether he should leave as CEO – the poll said yes, with 10 million votes. This led shares in Tesla to bounce back – though they slid back.
NEW SURVEY: Zap-Map has published it’s annual EV charging survey, it includes insights such as the fact that while 84% of EV drivers have a home chargers 90% use public infrastructure.
NEW PARTNER: MFG EV Power is now listed on the chargepoint aggregator app Bonnet. Read more.
ENERGY SUPPORT: A decision on extending help for businesses facing high energy bills will not be made until the new year, the government has confirmed. This comes after ministers suggested help would be expected. Read more.
HEAVY WORDS: The British Parking Association has warned that multi-storey car parks may not take the weight of EVs.
NEW REPORT: A report today by the Geospatial Commission has called for better use of location data in EV chargepoint rollout. See here.
By Tom Riley | Check my Linktree for LinkedIn, TikTok and Twitter
I have to take issue with the suggestion EVs are 36% more expensive than ICE cars. There may be a few extreme examples, but there are also plenty of cases where there is little or no difference.
For example a Porsche Taycan is cheaper than a Panamera. My Ioniq 5 was the same price as the Discovery Sport I was also looking at, and the lease price was lower.