UK new car sales slipped last month, but the electric vehicle market enjoyed a new milestone while Tesla’s recent slump in demand came to an end.
Registrations in August fell 2% year-on-year to 82,908 units, according to the Society of Motor Manufacturers and Traders (SMMT), reflecting the seasonal lull before September’s number plate change.
Battery-powered vehicles bucked the trend, with sales rising nearly 15% to capture a record 26.5% share of the market.
August "was the best month yet this year for EV market share and, while it is often volatile due to low overall volumes, the overall trend is positive", says SMMT chief Mike Hawes.
Gains for BEVs were attributed to broader model choice, manufacturer discounts and early - but still modest - signs of demand stimulated by the new UK Electric Car Grant, where there has been a phased release of the models eligible under the scheme.
Tesla registrations rose 7% to 3,243 units, reversing several months of declines and a steep 59% drop in July, following the UK launch of an updated Model Y.
Chinese rival BYD also expanded its UK footprint, with sales more than quadrupling to 1,759 units.
"September will be critical," he says, as this is when new number plates come in, which typically drives around one in seven new car registrations for the year.
"There is now a vast choice of electric models across all segments and many consumers will also, for the first time in three years, benefit from a grant to help them switch to electric."
The Electric Car Grant has had unintended side-effects, with the phased release of eligible models having "created some confusion", says Matas Buzelis at vehicle history platform carVertical.
"Drivers are unsure which cars will qualify for the grant - especially for the full £3,750 - so they hold off making a buying decision. Dealers re-quote finance, deliveries slip, and momentum stalls."
So, until the government publishes the complete vehicle list, "with a clear start date and stable criteria", Buzelis says many buyers will keep waiting.
"The ripple effect hits used cars too: fewer new registrations today mean tighter nearly-new supply tomorrow, prolonging shortages and keeping prices elevated. Simple, consistent incentives and clearer messaging would restore confidence, broaden choice, and ease costs."
James Hosking, managing director of AA Cars, agreed that said the SMMT figures can show how policy moves can sway demand, but with this being a second consecutive monthly fall, it points to "a fragile recovery and a market highly sensitive to external signals".
He also agreed that the "drip-feeding" of eligible vehicles perhaps "created some consumer uncertainty, leading to delays in purchases affecting overall sales growth".
Used EVs have seen steep price drops, he noted too, largely due to ex-fleet cars flooding into into the market, which has put models like the Tesla Model 3 and Nissan Leaf within reach of many more buyers.
"That’s helping the used sector stay buoyant, even as new sales falter," Hosking said.