Written evidence from Electrifying.com (ELV0075)

House of Lords Call for Evidence: Response from Electrifying.com

15 September 2023

Founded in 2020, Electrifying.com is an electric car-focused research and sales platform. The company was founded by broadcaster and motoring journalist Ginny Buckley to help the mainstream consumer understand, choose, buy, and run an electric vehicle by offering expert reviews, videos, and information on electric cars.

As a consumer-focussed outlet, we regularly see the questions, misconceptions, and fears that mass-market consumers have about making the switch to electric. We’re here to clear the air around electric vehicles; from upfront costs to public infrastructure, our submission comes at this from the perspective of our audience and the issues surrounding electric cars that matter the most to them.

At Electrifying.com we regularly engage with mainstream consumers who have different concerns and challenges than the early adopters we’ve seen making the switch to date. Our data tells us that the main obstacles to achieving the phase-out dates from a consumer perspective are affordability, education, and confidence in our public charging infrastructure.

Charging infrastructure was an issue that came up in recent data in a survey of 11,500 drivers that we conducted; in this, 70% of consumers told us they don’t have confidence in our charging infrastructure. While the majority of people will do their charging at home, it’s crucial that we give people the confidence (for longer journeys) they’re not going to be left stranded or let down on the occasions they do need to charge away from home. This is also a barrier for those drivers who don't have access to on-plot charging and will rely on public charging if they’re to make the move to an electric car.

Affordability is holding the market back. We need more affordable small cars with smaller batteries; giving consumers confidence that it’s ok to buy cars with less capacity also links into the charging piece - at the moment consumers want to buy a car with a large battery and more range, because they feel it will allow them to go further without worrying. If they knew they could rely on public chargers, we would see consumers buying smaller cars with affordable batteries.

Education is key to unlocking everything; we now need targeted campaigns partnering with brands like Electrifying.com, who can offer independent third-party advocacy, to help get unbiased - and crucially factually correct - information out to mainstream consumers. The majority of the mainstream media seems to be engaging in campaigns to discredit electric cars and the wider ecosystem; this is crucial to counterbalance this polarised and often factually incorrect reporting.

However, 2030 is absolutely achievable, mainly because of the ambiguity around 2035. Currently the 2035-part states that the car has to be capable of driving a significant distance on electric power only, but there's no definition of that. This gives manufacturers a bit of a get out clause to continue making ICE cars for longer. The government needs to provide clarity on that five-year period.

The targets on infrastructure don’t seem to be being met - the will and money is there from private industry to be installing infrastructure but the supply side in terms of electricity doesn't seem to have a plan when it comes to local infrastructure and national grid planning.

At the moment, the phase-out dates serve as more of a stick than a carrot. We've seen how incentives have massively increased the number of EVs being sold to companies, but private motorists have been more reluctant to switch, as they need more incentives to do so.

As above, we don't know what 2035 means - what will consumers be able to buy and not buy? These dates are quite far away from a consumer point of view, but the manufacturers have been working towards them for some time, as there’s a seven-year cycle in terms of product planning. This means that these cars are being developed now.

Success has been seen in the Benefit in Kind policy, which has massively improved the uptake of EVs. The policy of having six high powered chargers at motorway service areas is also improving the visible infrastructure which will in turn incentivise drivers to go electric.

The policies that are ‘anti’ EV appear to be the VAT on charging, removal of the plug-in-car-grant and the grant for home chargers and the imposition of road tax on EVs, which is a blanket regressive tax rather than another form of road charging.

A healthy uptake of used EVs is also crucial for the overall market, as the prices of used cars feed into the finance deals available on new cars, but a used EV is still out of reach for many consumers. Scotland has been fantastic in taking a lead on this with the introduction of their interest free loan for used EVs in order to kickstart the used market.

The other thing to consider is the cost of the charger (around £1,000). If you’re buying a used electric car, then an extra £1,000 on top of the vehicle is prohibitive to many.

Electric vehicle policy in government can’t just be for a few individuals or departments to lead on. It needs to be collective, with buy-in from the very top - leading by example can be very powerful. The Government needs to take a more holistic approach to this policy, looking across the sector instead of from within silos. We believe a Minister working alongside the various departments involved in this transition should be appointed to take a big picture view of the whole sector.

We’re asking consumers to change the habits of a lifetime, and this is the biggest switch in personal mobility since the horse and cart gave way to the car. It’s very hard to find the single source of the truth; brands like Electrifying.com and The AA are experts in the field, but there’s only so much that we can do to fight the misinformation in the press. There is an anti-EV agenda being driven in the mainstream media and unfortunately those outlets have huge reach and a huge audience, which makes it harder for brands like ours to fight against it by putting context against their claims and by correcting misinformation. Government needs to find out why this is happening and where this is coming from, but also needs to take a lead in making partnerships with the right brands who can get balanced messaging out.

We know from our audience research that the environmental benefits for EVs are driving consumers to make the switch; in a survey of over 1,600 people, 43% gave environmental reasons for either making, or considering, an EV. The messaging that doesn’t get across to mainstream consumers enough are the huge benefits EVs have on local air quality. This needs to be talked about more, as we know that it resonates with the consumers we’re engaging with.

From a new car point of view, there’s still the manufacturer and the dealer network. Senior executives at car companies are open about the challenges they face with their dealer networks giving consumers the information they need about electric cars. We know that this is a big issue, particularly while dealers still have to sell petrol and diesel cars, along with getting people to switch to electric. Some do it well, but the vast majority don’t, and there is a real need out there for independent, clear advice around the switch.

At Electrifying.com we’re working with one major OEM at the moment to create guides about switching to an EV for its dealerships, as they believe it gives the third-party advocacy and expert knowledge that their car buyers need. Schemes like this would be useful on a larger scale for getting that message out.

This is even more of a minefield when it comes to used EVs; the recent survey data we presented to the Secretary of State for Transport in a letter showed that 92% of consumers don’t have confidence in buying a used EV, as they have worries about the battery life and confidence in general, showing the need for a huge education piece in this area.

Once EVs reach the used market there is still a mistrust of EVs amongst independent car dealers, because of the recent fluctuations in car prices. That route to market needs to be made clearer, with more stability.

The main barrier is still price. The fact that the price used to be offset by a lower cost of ownership generally because the cost of electricity was cheaper, many consumers will find that it’s still cheaper to run an ICE car.

There is also a lack of education around EV ownership, as well as valid concerns about the up-front purchase costs.

10.

The Government simply isn’t doing enough to ensure that EVs are more affordable for consumers, and we see that in the high number of sales that are being made to the business market through heavily incentivised salary sacrifice schemes and lower Benefit in Kind. There is a low uptake amongst private buyers, and this definitely needs to be addressed.

11.

Affordability is a key issue, as there are currently only seven EVs priced under £30,000 in comparison to over 100 petrol and diesel models for car buyers to choose from. The batteries are still hugely expensive and until we can get consumers to have confidence in the fact that they can buy cars with smaller batteries, we’re not going to see this shift in the market.

China’s car industry has been supported by subsidies and has lower labour and supply chain costs. Many of the more affordable models in the UK are Chinese, and in recent research we carried out with our audience, we know that the vast majority (79%) of people aren’t concerned about where their car is manufactured, they’re simply looking at the price.

13.

The second-hand EV market is still in its infancy, but more consumer knowledge is needed in this area. The used market is set to grow from 71,000 units in 2022 (1% of the market share), to around 1.7 million cars by around 2028 (over 20% market share), but in order to get consumers on that journey, we need to give them confidence in buying an electric car. We know from research carried out in partnership with The AA this year that 92% of consumers don’t have the confidence to buy one, so we need targeted campaigns and education around used EVs if we’re to help people on this journey.

14.

Most car finance, including the most popular lease and PCP schemes, see the end user paying for the depreciation of the car and the interest on that amount. To calculate what that sum will be and the monthly finance rates, manufacturers must predict the future value of the car.

If demand for used EVs is low and the market is struggling, these predicted future values will be lower, which increases the finance and leasing costs on new cars.

18.

Access to off-street charging for the 40% of people who don’t have a driveway. We know that sales are going disproportionately to those who can charge at home, off-street. We have a huge job to do in giving those consumers who can’t access a charge point at home the tools and the confidence to switch to an EV.

The other challenge is around accessibility; we still have a charging infrastructure that isn’t accessible to all. Those with a disability often have issues charging, with for example high kerbs and heavy cables. From a public safety perspective, we have situations where we have charging points in obscure places that are hard to find, badly lit and feel unsafe.

19.

EVs are great to drive. Once we see more affordable energy tariffs being introduced to the market, they can be more affordable to run in some cases than petrol and diesel. There are also huge benefits for local air quality, they’re easy to maintain and if you can charge at home, the simplicity of waking up to a fully charged car in the morning is something that can really enhance a person's quality of life.

24.

Electric cars are still expensive and if you can’t charge at home. It can be very difficult in the private rental sector to have infrastructure fitted if that’s even an option. There are also questions around who pays for the fitting of chargers. In many ways, those who don’t have access to a private driveway are being discriminated against in the switch and that often is lower income drivers and those who live in cities and built-up places - the very areas that EVs can have the most benefit. We know that if you can’t charge at home, running an electric car can be more expensive (as much as £1,000 more per year according to our own data).

25.

This depends on usage and where a person can charge. As a rule of thumb, if you are paying more than 70p/kWh it is cheaper to use petrol in the average family car. However, anything below this (which will be the case for people who can charge at home), and the cost of charging an EV will be less than filling up an ICE car with fuel.

EVs also have fewer moving parts, which means that there is less that can ‘go wrong’ on the vehicle which could reduce maintenance costs.

Refuelling at home is also more convenient than filling up at a petrol station, and they make financial sense for people who have solar panels installed in their homes. Finally, people with access to charging at their workplace can do so with no tax implications.

26.

There’s a real lack of understanding from consumers on the car’s battery and we know this is a huge area of concern for the mainstream market. In the recent survey we conducted, 64% of drivers told us they didn’t believe the battery would last as long as the engine on a petrol or diesel car. This is despite the fact that in many cases, EV batteries are guaranteed by the manufacturer for longer than the car itself.

This is one of the biggest areas that we need to clear up with consumers, it’s been proven that batteries are lasting longer than anyone thought they would ten years ago, and because a battery has so many valuable components in it, it can go on to have a second and third life as for example battery storage.

28.

We know that at the end of a car’s life, the battery in a car that’s been powered by electricity is of far greater value than a petrol or diesel engine. This should help to keep prices of used EVs fairly buoyant and should provide a ‘base level’ below which it won’t drop.

However, there could also be cases where the value of the car is less than the battery, leading to usable cars being scrapped just for the battery - this is already the case with some petrol-powered cars and their catalytic convertors.

However, a used EV battery is more likely to be reused for energy storage (second life) rather than be broken down for minerals at this stage of its degradation as it is unlikely to be recycled until it is 20+ years old or damaged.

32.

There’s no doubt that we have charging deserts across the UK, with London and the South East boasting the most chargers. We know there are more public chargers in Westminster than in Liverpool, Manchester and Leeds combined, and if drivers can’t see charging infrastructure, they don’t feel it’s there for them to access which won’t give them confidence in making the switch.

33.

Local authorities are absolutely critical, as they’re the people who can get infrastructure rolled out within their areas. They’re the organisations with the local knowledge; we know that central government has issued a pot of money (the Local Electric Vehicle Infrastructure Fund) to help local authorities in the switch, but they need to start holding them to account.

The latest statistics released by the DfT show that 115 local authorities have accessed the On-Street Residential Chargepoint Scheme to help with the upfront cost of installing charge points. Although a further 83 have been awarded grant funding, this still means that 119 local authorities haven’t applied for funding, despite the scheme running since 2017.

34.

Scandinavia has been incredibly successful in its approach. The incentivisation went hand-in-hand with infrastructure and education; what really holds the UK back is the scattergun approach taken by the government. Different government departments are responsible for different areas of what is after all, critical infrastructure, and what would be incredibly helpful is if we had one person overseeing this.

Meanwhile in the US, we’ve seen the Inflation Reduction Act which is an incredibly joined-up approach aimed at supporting both consumers and industry in the switch to electric. The Government in the UK needs to have a clear green industrial strategy that backs this up.