The UK car industry has slammed the upcoming pay-per-mile car tax as being "just wrong" for the electric car industry, with experts warning the move risks damaging net zero goals and driver interest in EVs.
"It's the wrong measure at the wrong time" was the main feedback from the Society of Motor Manufacturers and Traders conference, which brought together the UK and wider EU vehicle industry.
Speaking to GB News, Mike Hawes, chief executive of the SMMT, warned that the announcement of new electric vehicle road taxes at the Autumn Budget sends the wrong message to drivers at a time when manufacturers are trying to convince as many consumers as possible to go electric.
He acknowledged the difficulties drivers may now have to purchase an EV, given the new tax burdens and consistently high public charging costs.
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Mr Hawes said: "We're trying to convince as many consumers as possible across the country to buy an electric vehicle, which is difficult if all they hear about is the specific tax implication on this vehicle.
"I know that when you fill up with petrol or diesel, a huge amount of that goes in both fuel duty and VAT, which is a tremendous. So the shift towards logification is going to erode that. This is the right purchase to make, but the tax mitigates against it."
The upcoming electric car tax is set to impact drivers in 2028, which is just two years away from the Zero Emission Vehicle mandate, which requires 80 per cent of all new car sales to be electric by 2030.
Mr Hawes warned that the tax could risk impacting the ZEV mandate by making it more difficult for drivers to switch away from petrol and diesel cars.
The SMMT warned that new car tax burdens for electric vehicles risk damaging interest in the market
| GETTY/X/DVLAMr Hawes explained how, regardless of the car tax implications, "we have no choice" in relation to meeting the ZEV mandate targets. "You have to get there by hook or by crook; that may come at huge costs in one of those options."
To combat this, the SMMT leader has called on the Government to review the ZEV mandate earlier than its intended 2027 proposal.
However, he cautioned that it needs to be a holistic review, saying: "You're looking at everything, all the input issues, the cost of production, the price of the bill, the price differential, the cost of charging at home, the cost of charging on the road."
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The new tax changes will see EV drivers pay 3p per mile and 1.5p per mile for plug-in hybrids | GETTYThe SMMT chief also touched on two of the biggest issues impacting drivers every day, namely the cost of electric cars and access to charging.
He explained that the industry is striving to bring down the cost of EVs and the price differential, which is, on average, about 17 per cent now.
"But you will see this year, from a number of manufacturers, the introduction of small EVs, which is a part of the segment which has been amongst the hardest to decarbonise because of the inherent cost of the battery," he shared.
On infrastructure, he explained that this is the other part of the equation. "It's giving people the confidence that wherever they'll be, they'll be able to charge, in the same way, you drive anywhere and can fill up."
The SMMT is calling on the next Government to increase support for EVs | PAAs for the cost of public charging, Mr Hawes said he has a lot of sympathy for the charging industry, because the costs being charged in terms of standing charges and use charges based on utilisation figures, "are ridiculously ambitious and are too high".
When asked whether the UK would meet its ZEV mandate of 33 per cent electric vehicles this year, despite the barriers, Mr Hawes said the industry "has no choice".
Iain Reid, head of editorial at Carwow, added: "As prices become more competitive and drivers benefit from a wider choice of models than ever before, interest in electrified cars continues to rise.
"Without sounding too much like hindsight, the targets always look tough to reach. It's now important for the Government to be clear about the direction it wants to take."