Electric vehicle prices have plummeted with record discounts of up to a third as manufacturers rush to meet their end-of-year targets.
Jaguar Land Rover has slashed £16,293 off its I-Pace model, bringing the price down from £78,331.
Even steeper reductions can be found at DS Automobiles, where the DS3 Crossback has seen a dramatic 36 per cent price cut, equivalent to £13,517 off the recommended price.
The discounts represent the deepest price reductions ever seen in the electric vehicle market, with an average discount of 12.4 per cent off official prices.
The DS 3 Crossback has seen a dramatic 36 per cent price cut
DS AUTOMOBILES
Popular models across multiple brands have seen significant price cuts in recent months.
The Peugeot E-2008 has been reduced by 26.5 per cent, while the Citroen e-C4 X is down 23.6 per cent.
Vauxhall’s Mokka-e has seen a 19.8 per cent reduction, with the Honda e:Ny1 and Nissan Leaf following at 18.8 and 18.1 per cent respectively.
Chinese-owned MG, despite its strong electric lineup, has also joined the price-cutting trend, reducing its MG5 by 34.2 per cent (£11,338 off £33,151) and the MG ZS by 30.1 per cent.
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Car makers must ensure 22 per cent of their new vehicles are electric this year or face £15,000 fines for each vehicle below target
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Even Tesla has lowered its Model 3 price from £42,000 to £39,000 for 2024.
The dramatic price cuts come as manufacturers face pressure from strict government quotas introduced under Rishi Sunak’s Government in January.
Car makers must ensure 22 per cent of their new vehicles are electric this year or face £15,000 fines for each vehicle below target.
The quotas are set to become even more demanding, rising to 28 per cent next year and reaching 80 per cent by 2030.
The quotas were introduced under Rishi Sunak’s Government in January
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“The ZEV mandate compels manufacturers to produce, but it does not compel consumers to buy,” says Mike Hawes, chief executive of the SMMT.
AutoTrader’s commercial director Ian Plummer forecasts that EV prices will continue falling until they match petrol or diesel vehicles by 2027.
In the second-hand market, three-year-old EVs have already reached price parity.
A new wave of affordable EVs is entering the market, with prices starting below £20,000.
The Dacia Spring is available from £14,345, while the Citroen e-C3 costs £21,035.
“That sort of discount finally makes it possible for the consumer to make a rational decision to buy an EV, rather than base it on emotional reasons such as environmental factors,” says Plummer.
The price cuts are causing significant challenges for manufacturers, with the SMMT revealing discounts will cost the industry £2 billion this year.
Despite these aggressive reductions, electric vehicles made up just 18.1 per cent of sales in the year to October, falling short of the 22 per cent target.
But AutoTrader’s Ian Plummer has warned of tough times ahead for manufacturers.
He said: “It’s going to be very painful. They are going to be selling EVs at a loss in many cases and they will have to arbitrage those losses with the profits they can still make on their diesel and petrol vehicles.”
Major manufacturers including Volkswagen, BMW, Mercedes, Nissan and Stellantis have already warned of lower-than-expected profits.
