Big Discounts on EVs

EV Discounts as BP and Tesla change strategies in response to slower EV adoption.

In a recent report by Auto Trader, a staggering 77% of electric vehicles (EVs) were snapped up at discounted prices last month, marking a significant leap from 55% the previous year. The average discount hit 11%. Petrol cars are also seeing their share of price reductions with around 24% experiencing cuts of at least ten per cent. 

The push for affordability comes at a crucial time as by 2024, 22% of all vehicles sold by major carmakers must be electric.

Market experts see these cuts as a boon for consumers. High prices have long been a stumbling block in the widespread adoption of EVs. However, the introduction of competitively priced Chinese models into the UK market promises to stir up the market, potentially driving prices down even further.

Despite the favourable market adjustments, the UK government remains steadfast in its decision not to reintroduce incentives for EV buyers. This follows the axing of plug-in grants two years ago.

BP

BP has significantly scaled back its electric vehicle (EV) charging division, BP Pulse, cutting over 10% of its workforce. This means more than 100 jobs and a narrowing of its focus to primarily four key markets, the United States, Britain, Germany, and China. 

This decision follows a reassessment of its strategy due to slower than anticipated adoption of commercial EV fleets. The company had initially expected to lead the transition to electric vehicles.

The reduction in workforce and market focus is part of BP’s broader strategy to concentrate on the most profitable areas of its business. This is amid scepticism from investors about the company’s transition from oil and gas to low-carbon energy sources. Despite these changes, BP Pulse remains one of BP’s five strategic growth areas. The company is still planning to expand its global network of charging points from 29,000 in 2023 to 100,000 by 2030.

BP also plans to enhance customer experience at its charging stations by integrating them with convenience sites. They aim for a return on investment in this sector to exceed 15% and generate $1.5 billion in earnings by 2025. 

However, the company has moved away from several initial ventures, including its home EV charging business. Now focus is more on fast-charging hubs, adapting to the slower transition pace and changing market dynamics.

Tesla

Tesla’s stock fell after the company announced a significant reduction of its workforce by more than 10%. This affects around 15,000 employees. Due to declining electric vehicle demand and other challenges including a booming Chinese market, stiff competition and a predicted slowdown in 2024.

This decision is part of broader issues, including a recent arson attack at its Berlin factory and logistical complications linked to the conflict in the Red Sea. 

Despite these setbacks, Tesla remains focused on navigating through these turbulent times, marked by a slowdown in EV adoption globally. The layoffs come as Tesla prepares for its upcoming quarterly earnings report, with the company having already noted a drop in vehicle deliveries and the first decline in almost four years.

Dealers won’t sell EV’s

Recent data from Cap HPI reveals that only a small percentage of independent car dealers are engaging with the electric vehicle (EV) market Just 17% have stocked and advertised an EV last month. 

This contrasts with 43% of franchised dealers and 49% of car supermarkets. There is a general reluctance among dealers to embrace EVs, despite growing consumer interest and profitability of used EVs. 

The report also notes that while some EV models saw a slight increase in value, others continued to depreciate. Yet they still offer good value compared to petrol models. As the volume of EVs is expected to rise, their competitive pricing may bolster buyer interest in the used car market. The market is seeing a return to normal seasonal demand levels.

Read more about the price reductions on EVs here.