The UK achieved a significant milestone last month as the one millionth electric car was registered, marking a noteworthy accomplishment despite a notable decline in sales, according to recent data.

Private registrations for new electric vehicles (EVs) experienced a 25% decrease in January, posing a potential challenge to the country’s commitment to achieving net-zero emissions.

The Society of Motor Manufacturers and Traders (SMMT) reported a 16% overall decline in new car sales to private customers during the same period. Despite this, the UK welcomed its one millionth battery electric car (BEV) on the roads in January, a milestone achieved since 2002, defying speculations of declining EV sales.

In January, over 20,000 BEVs were registered, reflecting a 20% year-on-year increase, largely attributed to favourable tax incentives for company car users. Notably, fleet buyers, particularly companies purchasing more than 25 units simultaneously, played a crucial role in this surge, with BEV demand growing by over 40%.

However, the drop in private registrations resulted in electric cars constituting only 14% of new vehicles sold in the UK in January, falling short of the 2023 target of 16.5%. This situation has prompted the SMMT to renew its appeal for tax cuts, urging the government to halve VAT on electric vehicles in the upcoming budget to stimulate demand among private buyers.

Despite this challenge, SMMT Chief Mike Hawes remains optimistic, stating, “It’s taken just over 20 years to reach our million EV milestone – but with the right policies, we can double down on that success in just another two.” Hawes emphasized the need for government support to ensure consumers can easily access the vehicles crucial for achieving net-zero goals.

Presently, individuals purchasing EVs through businesses, company car schemes, or salary sacrifice programs benefit from substantial tax incentives. However, grants for individual buyers were phased out by the government in 2022. The delay in the ban on new petrol and diesel car sales until 2035, as announced by Prime Minister Rishi Sunak last year, led to mixed reactions from car manufacturers. Despite the delay, strict quotas for selling electric cars were implemented, with fines for non-compliance, escalating each year until 2030.

While private car registrations saw a 16% decline in January, the overall new car market experienced growth, fueled by a substantial increase in fleet sales, which rose by a third. Fleet sales accounted for over 60% of new cars registered in January, up from just over half the previous year.