Electric Vehicle Sales Rise Despite Tesla Struggles

The UK automotive market continues to show signs of transformation as electric vehicle (EV) registrations surged in May, despite struggles from industry giant Tesla. According to the Society of Motor Manufacturers and Traders (SMMT), approximately 32,000 pure electric cars were registered, marking a 25% increase compared to the same month last year. Electric vehicles now account for 21.8% of the market share for May, and 20.9% for the year to date.

Despite this growth, the market remains far from the government’s zero-emission vehicle mandate, which requires 28% of sales to be electric by year’s end. Automakers failing to meet this target risk facing substantial fines, adding pressure to manufacturers already contending with sharp discounting to stimulate demand. According to SMMT Chief Executive Mike Hawes, discounts are becoming unsustainable, risking investments needed for future innovation and the decarbonisation of road transport.

The transition in vehicle preferences also became apparent in the continued decline of petrol and diesel car sales. Petrol car registrations fell by 12.5%, with only 71,000 units sold, while diesel sales slumped to just 5.2% of the market after a year-on-year drop of 15.5%. Collectively, hybrid, plug-in hybrid, and pure electric vehicles comprised nearly half of all vehicle registrations, reflecting a broader shift towards electrified options among UK consumers.

Tesla, once synonymous with the EV revolution, has faced significant challenges. The company saw a 36% drop in May sales, selling just 2,000 units. Year-to-date figures are similarly bleak, with an 8% decline compared to 2024. Tesla attributes these issues to difficulties scaling production of its new Model Y, currently its best-selling model. However, some analysts suggest public sentiment surrounding its CEO Elon Musk may also be contributing to a waning interest in the brand.

Meanwhile, competition from emerging brands such as Chinese manufacturer BYD highlights the evolving global landscape of the EV market. BYD achieved sales of 3,000 units in May, bringing its year-to-date total to 14,800 units—nearly doubling its annual 2024 performance. With affordable models entering the UK market, such as the forthcoming Renault 5 and Hyundai Inster, the competition in the EV segment is becoming fiercer than ever.

Maria Bengtsson, a transport consultant at EY, expressed that there is still no clear roadmap to meeting the UK’s aggressive net zero targets. Key challenges remain convincing consumers to make the switch, improving EV affordability, and enabling manufacturers to scale up while managing costs. Ian Plummer, commercial director at Auto Trader, noted that consumer interest is rising as EV models become cheaper, with some now priced closer to £22,000, bringing them within reach of more buyers.

The UK government’s support may be pivotal in ensuring the continued growth of the EV market. With lobbying efforts underway ahead of the next spending review, industry leaders are urging the introduction of fiscal incentives, such as VAT reductions, to accelerate adoption and reduce the reliance on manufacturer-driven discounts. The race to build a sustainable EV ecosystem that satisfies both consumer needs and emission targets is far from over, with innovation and affordability being the driving forces in the months and years ahead.