The Irish Times view on the EV sales slump: buyers need reassurance

Recent trends in the market for electric vehicles (EVs) suggest the targets set by Government for adoption of the technology will almost certainly not be met.

The Climate Action Plan 2021 outlined an ambition to have one million electric vehicles on Irish roads by 2030. Yet four-fifths of car sales in 2024 will be of petrol, diesel or hybrid vehicles, according to the Society of the Irish Motor Industry. And EV sales in the first quarter of this year are actually down 14 per cent from the same period in 2023. The Irish numbers reflect a global slump.

Why are EV sales falling? The reasons include concerns over unexpectedly fast degradation of their expensive batteries, along with a disappointingly slow rollout of charging stations. Both factors contribute to “range anxiety” among drivers. A slide in the resale value of EVs has also led to fears owners will be left to cope with drastic depreciation rates.

Some of these problems are being addressed; battery technology is improving and battery replacement costs are falling. Chinese manufacturers are bringing more competition, which should help with affordability.

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But consumers considering switching to electric may also worry that the current favourable tax rating of EVs will not continue. The transition to electric motoring will cost the exchequer at least ¤2.5 billion in lost excise duties, VAT, motor tax and vehicle registration tax (VRT) per year. Changes to the current regime seem inevitable.

The global drive to phase out the internal combustion engine is one of the most radical technological transformations since the industrial revolution and is central to the fight against climate catastrophe. It should not be a surprise that such a massive enterprise, entirely remaking one of the world’s largest manufacturing industries, should encounter market challenges along the way.

What is required now is a renewed commitment to a faster rollout of the national charging network, along with clearer communication of medium-term taxation plans to give potential EV buyers the reassurance they clearly need.