What you need to know
The market for electric and hybrid cars is going through a rapid rate of development. Whereas as recently as 2015 new sales were less than 73,000 units per annum, they had grown to nearly 120,000 units in 2017 and are estimated to reach 157,500 units in 2018. As a share of the GB car parc they are still a small feature accounting for only 1.5% of licensed cars. Yet this is ahead on 0.9% in 2015 and only 0.5% in 2013.
The prospects for the sector remain largely positive, albeit with some potential difficulties ahead. Manufacturers are increasingly offering cars in either hybrid or electric versions with plans from many for a switch away from petrol- and diesel-powered models over the coming decade. The last two years have seen considerable growth in the number of individual models offered with this likely to have played a major factor in boosting confidence amongst buyers as well as sales.
Yet issues remain, notably amongst car buyers with this illustrated by Mintel’s consumer research for this study. Only 44% of adults with a driving licence are currently interested in the purchase of a hybrid/electric car although this is up on 38% in 2016. Hybrids remain the preferred technology with potential buyers more likely to purchase one of these as compared to an electric car.
Of more concern for the market are worries about these vehicles with the purchase price of a hybrid/electric car and the issue of charging both noted as important. Taken with the decision by the UK government to scale back vehicles eligible for its plug-in car grant, as well as the reduction of this grant in October 2018, the sector faces a number of challenges if take-up of these vehicles is to continue to expand as hoped.
Products covered in this Report
Mintel’s Report on the hybrid and electric car market covers vehicles that are powered either wholly or in part by an electric motor and/or batteries as defined by the UK government. While these vehicles are becoming a feature of the UK car market, currently they still account for only a small percentage of vehicles on the road.
Five types of hybrid and electric car are included in this review:
Hybrid Vehicle or HV, combining an electric motor with a traditional fuel such as petrol or diesel. The electric motor is charged using the motion of the car and will typically kick in at low speeds
Electric Vehicle or EV, a vehicle powered, in part or in full, by an electric motor and battery that can be plugged into the mains or a charging point
Plug-in Hybrid Electric Vehicle or PH-EV, a vehicle with a battery and an internal combustion engine (petrol, diesel etc). Power from the battery is supplemented with power from the internal combustion engine. Once the charge of the battery is exhausted the vehicle operates as a hybrid. The battery can be plugged into the mains or a charging point
Range Extended Electric Vehicle or RE-EV, a vehicle powered by a battery with an internal combustion engine-powered generator on board. Once the charge of the battery is exhausted the internal combustion engine takes over. The battery can be plugged into the mains or a charging point or charged by the internal combustion engine
Fuel Cell Electric Vehicle or FC-EV, a vehicle that uses hydrogen gas or another product as a fuel, and which is stored in a compact, strong, but lightweight pressure tank. Power is generated by the fuel cell stack and is used to drive the FC-EV’s electric motor, with additional power supplied when needed from a secondary battery.
Within the hybrid and electric car market Mintel identifies a segment called ULEVs or Ultra-Low Emission Vehicles. ULEVs have traditionally been defined as cars or vans with tailpipe CO2 (Carbon Dioxide) emissions of 75g/km or less. This definition was changed by the UK government for the purpose of its plug-in car grant to less than 50g/km of CO2 in October 2018.
