2. Weekly Newsletter
Electric cars share of UK market falls
Manufacturers are feeling doubts over whether they can reach new green targets as electric cars share of Uk market falls for the first time annually. The share UK market has been rising each year and reached a peak of 16.6% of annual sales in 2022. In 2023, the share failed to increase and stayed at 16.5%. This has prompted manufacturers to be requesting tax cuts and new incentives for private investors to restore growth in EVs.
This stagnation is partly due to consumers being sceptical of the technology and the prices staying high whilst many were expecting the prices to be far lower by this point (especially considering the ban on petrol cars in the Uk by 2035). Carmakers have warned that added incentives are absolutely necessary as the market moves shifts from attracting eager early buyers to the mass market who are more reluctant to make the switch. Although the running cost is far cheaper for an electric car, the initial cost is far higher at roughly 40%.
This lack of growth in EVs is concerning for car manufacturers as in the UK, 22% of all cars sold this year have to be zero emission and this percentage will continue to rise up to 80% by 2030 which looks like a challenging target to reach under current EV consumer interest.
The UK is in the middle of the pack compared to the rest of Europe with other countries having a relatively low EV market share; Germany (18%), Portugal (17%), Belgium (19.3%, Sweden (39%). All of Europe lags far behind leaders Norway where 83% of cars sold in 2023 were electric.
The UK’s front page news cycle over the last seven days has covered a wide range of topics. Rishi Sunak looks back to 1992 with latest election strategy pivot, oil and gas executives leaned on to support controversial UK North Sea oil bill and UK mortgage rates fall. Some of the newspaper headlines from this week were:
- Financial Times- ‘UK government sets out bigger post-Brexit subsidies for farmers’
- Financial Times- ‘UK grocery price inflation falls at fastest rate on record, research finds’
- The Guardian- ‘Ministers scramble to clear names of victims of Post Office Horizon scandal’
- The Times- ‘Train giant Govia pays out record dividend despite strikes and Covid’
- Sunday Telegraph- ‘Rishi Sunak delayed signing Rwanda treaty over fears of ‘distracting’ Supreme Court’
Uk house prices on the rise
Uk house prices rose for the 3rd consecutive month in December and hasn’t been this high in almost a year. Average house prices for December increased by 1.1% and 1.7% by the year. This data comes alongside construction of houses being the highest in nearly 6 months too highlighting a rebound in the housing market as a whole. This has been attributed to a lack of properties on the market in December, forcing an influx in demand. Economist at Capital Economics has said the housing market rebound has confirmed that the fall in mortgage rates has helped to bolster housing prices. London remained the most expensive part of the UK, costing almost £530,000 on average, despite annual declines of 2.3% in England’s capital.