Table of Contents
Overview
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- Key issues covered in this Report
- COVID-19: market context
- Impact of the January lockdown and the vaccination rollout
- Economic and other assumptions
- Products covered in this Report
Executive Summary
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- Impact of COVID-19 on hybrid and electric cars
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- Figure 1: Short, medium and long-term impact of COVID-19 on the hybrid and electric car market, December 2020
- Market size
- Hybrid and electric sales increase despite COVID-19
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- Figure 2: Hybrid and electric new car registrations (United Kingdom), by volume, 2015-25
- Hybrids will dominate in the short to medium term
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- Figure 3: Hybrid and electric car new registrations, by type (United Kingdom), by volume, 2021-25
- Plug-in hybrids dominate the ULEV market
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- Figure 4: ULEV licensed cars (United Kingdom), by volume, Q2 2020
- Private and online sales expected to benefit from COVID-19
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- Figure 5: Sales of new and used electric and hybrid cars, by channel, 2020
- Growth in range of models is a major boost for the market
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- Figure 6: Development of ULEV models, 2015-20
- UK-EU agreement signals positive news for the wider car sector
- Revised date for phasing out sale of petrol and diesel cars
- Companies and brands
- Market is dominated by a small number of manufacturers
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- Figure 7: Hybrid and electric manufacturer group share (licensed cars), Q2 2020
- Innovations focus on improvements in hybrid and electric technology
- Broadening of models helps boost advertising expenditure
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- Figure 8: Recorded above-the-line, online display and direct mail total advertising expenditure on hybrid and electric cars, 2015-19
- The consumer
- Growth in hybrid and electric car sales should boost ownership
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- Figure 9: Vehicle ownership, September 2020
- Profile towards owning older cars may hamper market development
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- Figure 10: Age of car owned, September 2020
- Commuting offers an important opportunity for the market
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- Figure 11: Main uses for a car, September 2020
- Future prospects for the sector appear promising
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- Figure 12: Interest in purchasing a hybrid/electric car, September 2020
- Most potential buyers appear in no rush
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- Figure 13: Interest in purchasing a hybrid/electric car, September 2020
- More needs to be done to reduce worries about hybrid and electric technology
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- Figure 14: Interest in type of hybrid/electric car, September 2020
- Investment in online communication should resonate well with buyers
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- Figure 15: Sources of information on hybrid/electric cars, September 2020
- Worries about charging and vehicle price remain key concerns for potential owners
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- Figure 16: Concerns about hybrid/electric cars, September 2020
- Addressing concerns of young adults should be a priority
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- Figure 17: Attitudes towards hybrid/electric cars, September 2020
Issues and Insights
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- Hybrid sales set to benefit as wider car market is dented by COVID-19
- 2030 target to ban new petrol and diesel cars won’t be met without further support
- Key groups will be essential to drive forward mass-market appeal
The Market – Key Takeaways
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- COVID-19 fails to dent demand for hybrid and electric cars
- Slowdown for the UK economy unlikely to affect growth prospects…
- …with UK government commitment set to continue to drive forward growth
- ULEVs remain focused towards the South East
- Online sales set to benefit from COVID-19
- Number of ULEV models available is growing
Market Size and Forecast
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- Hybrid and electric car market escapes any major impact from COVID-19
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- Figure 18: Short, medium and long-term impact of COVID-19 on the hybrid and electric car market, December 2020
- Electric and hybrid cars are increasingly becoming mainstream
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- Figure 19: New car registrations (United Kingdom), % of total, 2015 and 2019
- COVID-19 unlikely to have an impact on hybrid and electric sales…
- … with Brexit agreement avoiding further potential difficulties
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- Figure 20: Hybrid and electric new car registrations (United Kingdom), by volume, 2015-25
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- Figure 21: Hybrid and electric new car registrations (United Kingdom), by volume, 2015-25
- Demand for diesel cars collapses
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- Figure 22: New car registrations (United Kingdom), by volume, 2015-20
- Demand for battery electric cars accelerates…
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- Figure 23: Hybrid and electric car new registrations, by type (United Kingdom), by volume, 2015-20
- …although it will be hybrids that will dominate the period 2021-25
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- Figure 24: Hybrid and electric car new registrations, by type (United Kingdom), by volume, 2021-25
- Market drivers and assumptions
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- Figure 25: Key drivers affecting Mintel’s market forecast, 2015-25 (prepared on 25 November 2020)
- Learnings from the last recession
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- Figure 26: Hybrid and electric new car registrations (Great Britain), by volume, 2007-12
- Forecast methodology
Market Segmentation
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- 3% of the car parc will comprise of hybrid and electric cars in 2020
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- Figure 27: Hybrid and electric vehicle car parc (United Kingdom), by volume, 2015-20
- Majority of vehicles in use are hybrid
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- Figure 28: Hybrid and electric vehicle car parc (United Kingdom), by volume, 2015-20
- Over a third of ULEV cars licensed are in London and the South East
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- Figure 29: ULEV licensing (United Kingdom), by type and regional share, Q2 2020
- PH-EVs dominate licensed ULEV cars
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- Figure 30: ULEV licensed cars (United Kingdom), by volume, Q4 2015-Q2 2020
Channels to Market
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- Dealers are the main channel for hybrid and electric cars
- COVID-19 is set to raise the profile of private sellers and specialists online
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- Figure 31: Sales of new and used electric and hybrid cars, by channel, 2015-20
- Wider profile of online has until recently been limited
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- Figure 32: Car advertisements in the UK, by fuel type (ebay.co.uk), 2016-20
- Recent investment suggests that its profile is about to strengthen
Market Drivers
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- COVID-19 restrictions
- Car parc has expanded by over 30% since 2000
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- Figure 33: Number of licensed cars (Great Britain), million units, 2000-19
- Consumer confidence hit during 2020 by COVID-19…
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- Figure 34: Consumer financial confidence, January 2015-November 2020
- …although Brexit agreement avoids further potential difficulties
- Pandemic set to depress new and used car sales during 2020
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- Figure 35: New and used car market volumes (United Kingdom), million units, 2015-20
- Hybrid and other vehicles are slowly growing their presence
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- Figure 36: Number of licensed cars (Great Britain), million units, 2015-20
- Poor new car sales hits growth of low-emission vehicles
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- Figure 37: Number of licensed cars (Great Britain) 1-100g/km CO2, 2009-19
- Growth in the number of ULEV models is accelerating
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- Figure 38: Development of ULEV models, 2015-20
- Charging network continues to expand…
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- Figure 39: Number of charging locations and connectors, 2015-20
- …as does its speed
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- Figure 40: Developments in connector speed, 2015-20
- New hybrid and electric cars remain expensive
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- Figure 41: On-the-road prices for the bestselling ULEVs (Q2 2020), November 2020
- Extension of clean air zones across the UK
- Cost pressures for car owners have moderated recently
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- Figure 42: Consumer expenditure on car purchasing, servicing and repair and motoring expenses, seasonally adjusted at current prices, 2015-19
- Growing percentage of households own two or more vehicles
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- Figure 43: Percentage of households with car availability, England, 2009-19
Regulatory and Legislative Changes
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- Office for Low Emission Vehicles
- Policy commitments
- 2015 and 2018 announcements towards zero emissions
- 2020 and changes to the phasing out of conventional fuels
- Plug-in grants
- Chargepoints
- Private
- Public
Companies and Brands – Key Takeaways
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- Nissan-Renault-Mitsubishi Alliance dominates the UK market
- Innovations focus on technology and accessibility
- Promotional support is increasingly directed towards electric cars
Market Share
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- Nissan-Renault-Mitsubishi Alliance cars account for nearly a third of the market
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- Figure 44: Hybrid and electric manufacturer group share (licensed cars), Q2 2020
- BMW consolidates its position as the biggest brand in the market
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- Figure 45: Hybrid and electric brand share (licensed cars), Q2 2018 and Q2 2020
- Mitsubishi’s Outlander PHEV is most significant model
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- Figure 46: Top 10 hybrid and electric models (licensed cars), Q2 2020
- Premium brands dominate the plug-in hybrid market
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- Figure 47: Top 10 plug-in hybrid electric models (licensed cars), Q2 2020
- Electric market sees interest from a mix of brands
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- Figure 48: Top 10 electric models (licensed cars), Q2 2020
- Toyota’s Mirai dominates the emerging fuel cell market
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- Figure 49: Fuel cell models (licensed cars), Q2 2020
Launch Activity and Innovation
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- Hyundai and INEOS working together on hydrogen fuel cells
- Tesla promises increased performance from its electric batteries
- Zap-Map launches new pay app
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- Figure 50: Zap-Pay, September 2020
Advertising and Marketing Activity
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- Promotional support on the up
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- Figure 51: Recorded above-the-line, online display and direct mail total advertising expenditure on hybrid and electric cars, 2015-19
- Broadening of the advertising base is behind the increase in investment
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- Figure 52: Recorded above-the-line, online display and direct mail total advertising expenditure on hybrid and electric cars, by manufacturer, 2015-19
- Investment towards electric cars grows
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- Figure 53: Recorded above-the-line, online display and direct mail total advertising expenditure on hybrid and electric cars (top 20), by manufacturer and brand, 2019
- Television dominates when it comes to investment
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- Figure 54: Recorded above-the-line, online display and direct mail total advertising expenditure on hybrid and electric cars, by media type, 2019
- Nielsen Ad Intel coverage
The Consumer – Key Takeaways
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- COVID-19 worries and concerns about expenditure are easing
- Young men are notable owners of hybrid and electric cars
- Only around a quarter of cars in ownership are under three years old
- Car use polarised towards commuting or broader uses
- Interest in hybrid and electric is high but few want to purchase one now
- Most car owners want the security of tried and trusted technology
- Information is moving online
- Charging the leading concern in owning a hybrid or electric car
- Worries for young adults need to be overcome
Impact of COVID-19 on Consumer Behaviour
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- Fewer adults are worried about the risk of COVID-19
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- Figure 55: Worries about risk of exposure to COVID-19, April-October 2020
- Fall in those who are shunning non-essential spending
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- Figure 56: Non-essential spending, April-October 2020
- Little evidence of a shift towards new ways of purchasing
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- Figure 57: Shopping habits, April-October 2020
Vehicle Ownership
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- While car ownership is high a significant minority don’t own a car
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- Figure 58: Vehicle ownership, September 2020
- Hybrid and electric cars are proving popular with young adults
- Income is an important divide between those owning standard and hybrid/electric cars
- Young adults are most likely to own another type of vehicle
Age of Car Owned
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- Just over a quarter of cars were purchased in the last three years
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- Figure 59: Age of car owned, September 2020
- Income plays a major part in the age of car owned
- Young men favour newer cars
- Regional differences in vehicle age shouldn’t be overlooked
- Ownership of older cars is growing
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- Figure 60: Age of car owned, 2016-20
Main Uses for a Car
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- Majority of commuters view this as the main use for their car
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- Figure 61: Main uses for a car, September 2020
- Older adults record a variety of uses for their car
- Higher earners have broad demands
- Commuting already popular for hybrid and electric owners
Interest in Purchasing a Hybrid/Electric Car
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- Over half of traditional car owners are interested in a hybrid or electric vehicle
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- Figure 62: Interest in purchasing a hybrid/electric car, September 2020
- Young men record a high level of interest in ownership
- Wealthy adults are also an important market
- City dwellers turning green
- Owners of younger cars represent a stronger opportunity
- Car owners are becoming more confident about hybrid/electric
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- Figure 63: Interest in purchasing a hybrid/electric car, 2016-20
- No immediate rush to purchase by many potential buyers
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- Figure 64: Interest in purchasing a hybrid/electric car, September 2020
- Middle-aged adults are the best short-term prospects…
- …with families likely to offer good opportunities
- No time to wait if city market is to be developed
- Owners of cars less than three years old present best prospects for purchase
Interest in Type of Hybrid/Electric Car
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- Hybrids dominate as the preferred technology choice
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- Figure 65: Interest in type of hybrid/electric car, September 2020
- Men are a key market for emerging technologies
- Older adults most likely to go for hybrid
- Location doesn’t appear a barrier towards new technology…
- …nor does wealth for electric vehicles
- Hybrid is best placed to capture interest from owners of older cars
- Interest in technologies is narrowing towards a smaller number
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- Figure 66: Interest in type of hybrid/electric car, 2018 and 2020
Sources of Information on Hybrid/Electric Cars
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- Websites are by far the most popular channels for information
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- Figure 67: Sources of information on hybrid/electric cars, September 2020
- Channel preferences vary by age
- Physical engagement for information is low in cities
- Direct communication by dealers important for owners of newer cars
- Dealer websites are the real winners when it comes to information
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- Figure 68: Interest in purchasing a hybrid/electric car, 2016-20
Concerns about Hybrid and Electric Cars
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- Charging and price are the two key concerns with electric cars
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- Figure 69: Concerns about hybrid/electric cars, September 2020
- Men have visual worries
- Charging is a concern for older adults
- London is ready to go
- Resale issue on the minds of low earners
- Concern about the future role of going electric
- A broadening of models is necessary if opportunities from new car owners are to be grasped
- Older adults who are not working are most concerned about the price of purchasing a hybrid/electric car
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- Figure 70: Hybrid and electric cars – CHAID – Tree output, September 2020
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- Figure 71: Hybrid and electric cars – CHAID – Table output, September 2020
Attitudes towards Hybrid/Electric Cars
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- More is needed to garner confidence in electric cars
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- Figure 72: Attitudes towards hybrid/electric cars, September 2020
- Issues for young buyers need to be addressed
- Older adults appear best placed for hybrid sales
- Less wealthy car buyers shouldn’t be overlooked
Appendix – Data Sources, Abbreviations and Supporting Information
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- Data sources
- Exclusions
- Abbreviations
- Consumer research methodology
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