11 July 2023

Trust the market to deliver new fossil fuel car phase-out by 2030

By Lynsey Jones

Despite the recent media frenzy, the Government must not waver on the 2030 end date for sales of new fossil fuel-powered cars.

Yes, there are certainly challenges that come with that target, but they are not insurmountable. Indeed, the 2030 date is already driving innovation, with new cars entering the market every year that go further and faster than the last.

The transition is also far more gentle than some sceptical voices suggest. Rather than a ban on all petrol and diesel cars, as some outlets have claimed, the target is aimed just at new sales. This means we’ll still be able to buy second-hand petrol and diesel cars. Drivers in the UK are already more likely to buy second-hand – there were 6.8 million used car sales in 2022 compared to 1.6 million new sales.

Plug-in hybrid cars will also still be available to buy brand new. The new sales phase-out date for these is a further five years after the 2030 petrol and diesel target. Hybrids switch between petrol and electric power, using electricity for short trips with petrol backup for longer journeys. So for those drivers nervous about fully electric cars, there will still be a brand new hybrid option available on the market beyond 2030.

Sales of pure electric cars, which are better for the environment than hybrids, are increasing faster than predicted. In 2014, 2.2% of new car sales were electric. Eight years later, in 2022, this figure was 16%. Now with an established industry and new electric car models entering the market each year, this number is expected to ramp up to four out of five cars over the next eight years. And that’s not even including hybrids.

Sales of electric cars have increased in no small part due to the improved technology and driver experience. The best-selling electric car in 2009 was the G-Wiz, a car that Top Gear once titled the ‘Worst Car of the Year’. It had a top speed of 50mph and a range of 48 miles. Last year, the best-selling electric car in the UK was the Tesla Model Y, which can reach speeds up to 150mph, and its range on a single charge is almost seven times that of the G-Wiz.

Costs are also coming down. The sticker price of an electric car is still more than that of a petrol or diesel equivalent, but lifetime costs are already cheaper. And price parity with petrol and diesel equivalents should be reached by 2027. Despite electricity costs rising due to the gas crisis, it is still significantly cheaper to charge up an EV battery than fill up a petrol or diesel tank. New tariffs and packages from companies like Octopus Energy mean that you could charge up your car for as little as 7p per kWh or around 3p per mile. Refilling a petrol or diesel car costs, on average, between 19p and 21p per mile. This same ingenuity will no doubt continue to bring the upfront cost of EVs down.

And as more EVs hit the road, the second-hand market will play a bigger role in EV rollout. As we’ve already seen, this is where the majority of Brits get their cars.

Above all, as CapX readers will appreciate, we need to trust the private sector. The 2030 phase-out, along with the incoming requirement on manufacturers to ramp up EV sales, has given certainty to business, which has responded with innovation and cost reductions.

By the end of 2023, there will be over 120 different electric car models on the UK market. Increasing variety means that there will be something to suit everyone, from family cars for school drop-offs to long-range estate cars for work trips. Abandoning the target would send the wrong signal to the market, penalise environmentally conscious car firms, and jeopardise the progress made so far.

But to make the transition as seamless as possible, the charging network must improve quickly. Again, industry is leading the way. The Government has set the direction of travel with its aim to have 300,000 charging points installed by 2030, and charging companies are responding with cold hard cash. The UK’s largest charge point companies are set to invest £6bn by 2030 and will double the size of the UK EV charging network in 2023.

Abandoning the phase-out would be politically problematic. With climate consistently a top five voter concern and the Prime Minister’s environmental credentials recently called into question, the Government should be conscious of the political damage of reneging on this commitment. Particularly as we are on course to deliver it. Delaying the target would send the wrong signal to manufacturers, create uncertainty and jeopardise the innovation and investment we need to deliver a seamless transition to cleaner vehicles.

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Lynsey Jones is Senior Climate Programme Manager at the Conservative Environment Network.

Columns are the author's own opinion and do not necessarily reflect the views of CapX.