For anyone looking to buy a new electric vehicle it seems to be Black Friday all month.
UK car dealers are offering dramatic discounts of more than a third off some new EV prices.
This year, even prime models from blue-chip brands are up for grabs at super-low prices. Current offers include £8,000 off the Hyundai Ioniq 5, £9,000 off the VW ID4 SUV and £10,000 off the BMW i4 coupe.
Why are EVs so cheap?
The unprecedented price plummet is not just the end-of-season, discontinued-lines discounts the UK car market is accustomed to.
The panic has been caused by car manufacturers stockpiling electric vehicles, anticipating that more buyers will invest in zero-emission vehicles.
The trouble is, the opposite has happened – thanks to high prices and limitations of the UK charging network.
This has created a perfect storm for manufacturers panicked by a Government target.
A fifth of all sales this year must be EVs – with a hefty financial fine of £15,000 per car below the target. While this is bad news for the car industry, it is, of course, great news for buyers, as all the stock has to be shifted.
Should I buy now or wait?
The big decision buyers face now is whether to stick or twist. Is it worth gambling on waiting for further price drops next year?
Industry insiders such as Philip Nothard, Insight Director at Cox Automotive, the world’s largest auto technology provider, say the likelihood of future discounts will depend on whether the current round of price cuts work.
Will they stimulate sales – or will demand remain sluggish? Cox outlines several scenarios but describes the Government targets as ‘potentially unobtainable’.
Further EV price cuts are definitely expected by European investment bank UBS. ‘We expect an EV price war evolving in the course of next year,’ it says, while leading UK auto finance group Close Brothers is predicting ‘dampened demand’.
What is certain is that further price pressure will come from affordable new models from the Chinese MG and BYD brands arriving in 2025 to undercut European EV prices.
Shrinking government subsidies and tax breaks for EV owners may continue to keep demand low, even as prices tumble.
At present, EV owners are exempt from paying road tax and the Expensive Car Supplement, an additional tax on cars costing over £40,000. In 2025, both of these benefits will be taken away.
And in the background, UK motor market turmoil is further exacerbated by changes to the deadline for selling new petrol and diesel cars.
After the Tories slid it back to 2035, Labour is expected to announce it is reverting to the original 2030 cut-off point soon.
Manufacturers are lobbying the Government this week, complaining about the penalties for falling short of EV targets.
They seem doomed to failure, however, after Transport Secretary Louise Haigh said in advance of discussions: ‘The mandate will not be weakened.’
On paper at least, there is still a huge difference in the price tags between petrol or diesel cars and EVs, which are around 40 per cent more expensive. An electric Vauxhall Corsa retails at £32,000; a petrol version £19,000.
For a Mini Cooper the price hike is from £23,000 to £32,550.
The Government is optimistically predicting this gap will soon disappear. According to the
Gov.uk website: ‘Some EVs could be around the same price to purchase as a petrol or diesel car by the end of the 2020s.’ Whether this is true or not, it may have the effect of persuading motorists to postpone an EV purchase until prices do fall further.
What will future running costs be?
Most motorists dream of reaping the rewards of the cost saving between filling a fuel tank at the forecourt and charging up an EV from the mains at home.
Research from giant motor insurance group LV= suggests annual running costs of an EV are up to 49 per cent lower if you factor in tax, insurance, fuel and maintenance. The average Nissan Leaf owner, for example, spends £93 a month less running their car than the owner of a Ford Focus.
Other savings are less clear. Company car tax is currently favourable for EVs at only 2 per cent. The more CO2 a car emits, the more you pay, reaching a hefty 37 per cent for the biggest gas guzzlers.
However, next year the new Government has announced EV company car tax will increase 1 per cent each year from 2025, rising to 5 per cent by 2028.
EVs are also currently exempt from vehicle excise duty. Petrol and diesel cars owners are liable to a wide range of VED charges dependent on fuel, emissions, engine size and age of vehicle. It can reach more than £2,500 in its first year in extreme cases.
That changes for EVs next year too. The only concession to EVs is likely to be favourable first-year rates duty.
Nevertheless, the Government suggests that anyone buying a new EV now will recoup the additional upfront cost within five years due to lower running costs.
Figures are vague and rely on research from the eco/climate research group Energy & Climate Intelligence Unit that predates the changes in electricity prices and tax liabilities.
Six of the best EV buys
Here are six of the best EV models recommended by reviewers Autotrader, Autocar, What Car? and Carwow that offer the best discounts...
Hyundai Ioniq 5
Driving it is described as ‘pure joy’ by Autotrader’s reviewers.
The compact SUV has a futuristic design, spacious interior, ultra-fast charging, 300-mile range, low depreciation and strong warranty of five years.
Current discount: Up to 20 per cent off, meaning price cuts up to £8,000. Lowest new price this week was £39,745 (Autotrader), down from £46,600, or a personal lease plan from £307pcm (Carwow).
Dacia Spring
The groundbreaking new electric city car is already a bargain.
‘It’s lots of fun . . . everything you want,’ says Top Gear.
The Spring’s range is just 140 miles, but it’s one of the cheapest new cars of any type available in the UK.
Current discount: Despite a bargain-basement list price, extra discounts of up to £860 mean you can now get this brand new EV from just £14,135 (Autotrader), down from £14,995, or lease from £144pcm (Carwow).
Kia EV6
‘Technologically and stylistically progressive,’ says Autocar. The family SUV
is roomy, fast-charging and is also engaging to drive. It has a 310-mile range, a reputation for reliability, low depreciation – and comes with a very impressive seven-year warranty.
Current discount: Up to 20 per cent off – that’s a saving of almost £9,000. The lowest new price we found was £36,999 (Autotrader) – that’s down from £45,950 – with the cheapest leasing from £423pcm (Carwow).
BMW i4
The AutoExpress Premium Electric Car of the Year ‘oozes quality’, say its reviewers.
This stylish coupe has the latest tech, is beautifully built and is swift and exciting on the road, they add.
The i4 has rapid charging and a range of over 300 miles. It has average depreciation, retaining around 50-55 per cent of its value over three years.
Current discount: Up to 20 per cent off, meaning savings of around £8,000. The lowest new price is £43,189, down from £51,270 (Autotrader); cheapest leasing from £454pcm (Carwow).
Citroen e-C4
This practical Golf-sized hatchback is ‘likeable, useable and maximises comfort’, says Car Magazine. The e-C4 has a great cabin, softly cushioned ride and neat fastback styling.
There are two battery options, with 220 and 260-mile ranges respectively.
With prices starting at just over £30,000 there are bound to be drawbacks: charging speed is average and depreciation is high, but recent discounts may persuade you that it’s worth it.
Current discount: Some dealers are offering £10,000 off a car that was already competitively priced. The lowest new price we found is £22,495, down from £31,960 (Autotrader) or lease plans from £226pcm (Carwow).
MG4
What Car? reviewers judged this five-door Chinese family hatchback the ‘small electric car of the year’.
The battery range is from 225 miles upwards, charging to 80 per cent takes just 39 minutes and depreciation is one of the lowest among EVs.
Reviewers forgive its quality shortcomings such as cramped rear seats and reliability issues because of extremely low prices and the reassuring seven-year warranty.
With additional big discounts, that case becomes even more compelling.
Current discount: Cuts of more than £6,000 from an already eye-catching price tag are very appealing. Lowest new price is £19,944, down from £26,995 (Autotrader), with leasing from just £219pcm (Carwow).
Don't bother, even at a discount
Not all deals are worth snapping up. Expert reviewers advise ignoring even the big recent price cuts on these models:
Mazda MX-30
With a five-out-of-ten score from Top Gear, this ‘uninspiring’ compact SUV has a ‘pitiful’ range of just over 100 miles.
That lack of usability means most buyers should ignore discounts of £10,000 and prices from just £17,995.
Mercedes EQA
Carwow gave the smart Mercedes family hatchback just six out of ten, saying it has a small boot, is uncomfortable and over-priced. Insurance is high, too.
The Merc’s claimed range is from 259 miles, charging is slower than rivals and depreciation is only average at around 42-48 per cent over three years.
So even though there are discounts of more than £7,000 being advertised, the lowest priced EQA still costs a hefty £42,250 and isn’t worth the money.
Citroen Ami
With only two out of five from What Car? the tiny two-seater city car makes absolutely no sense for the majority of UK motorists, even with £500 discounts on the ultra-low price.
You can find one as cheap as £7,695 (Autotrader), but beware the claimed range is just 46 miles (much less in cold weather) and, flat out, its maximum speed is only 28mph.
Porsche Taycan
Rated the UK’s least reliable electric car by What Car researchers, the superfast supercar is also super expensive.
Huge current discounts of up to £13,000 still leave buyers facing a price tag starting at a hefty £82,924.
There are better value and more reliable rivals.
Bargains worth waiting for?
Some of the best EV bargains may not have happened yet. Here are the cars where patience could pay dividends:
Kia EV3
The acclaimed mid-sized Korean SUV has just been launched so hasn’t been discounted yet.
You’d be lucky to get £100 off a car that retails from £32,850.
But hold on...the five-out-of-five rated (What Car?) hatchback is likely to benefit from price cuts in the new year when the launch frenzy eases.
Renault 5 E-Tech
The brand new retro-styled electric Renault 5 is due here early next year.
The high-tech 5 is a modern recreation of the hatchback UK favourite in the 70s, 80s and 90s. Renault promises a range of about 250 miles and rapid charging.
Expected list prices are around £23,000, so if there are discounts, too, it could be stylish bargain worth waiting for.
Second-hand bargains... or not?
Which? researchers who trawled the second-hand market this month found the huge new dealer discounts on electric cars are affecting the prices of nearly-new cars, too.
This means EVs with less than 100 miles on the clock are being offered at extraordinary discounts to undercut the deals on brand-new cars.
They spotted one sporty Peugeot e308 SW GT estate offered at £21,995 – that’s half of its price when new.
A Nissan Leaf N-Connecta at £16,481 is a discount of 47 per cent on the brand-new car – and this one had only done ten miles.
Nearly-new discounts are common – but not of this magnitude. Some of the bargain almost-new cars are former showroom demonstrators; others are being registered by the dealers and being sold to simply shift excess stock.
Note that the downsides of buying nearly new are the same as ever: you can’t choose the trim, colour and specification of your nearly-new car.
You take what you’re given, and often the trim is basic with a few extras fitted.
Sometimes nearly-new models are actually a couple of years old and have been sitting unwanted and unloved in a showroom or, worse, are still in a storage yard.
The warranty may be shorter and less comprehensive, the finance deals less favourable and the resale value may be less – because you’ll already be the car’s second owner.
