Discounts on electric vehicles (EVs) are on the rise in UK dealerships. According to 2023/2024 data from UK new car transactions, EV discounts have increased significantly year-on-year, with the average amount available to car buyers doubling. This shift reflects broader trends in the automotive industry, with new entrants to the EV market and changing customer demand impacting incentives.
While these price reductions can help move stock, maintaining clear visibility across segments and recognising the underlying dynamics behind discounts is critical for driving competitive, market-focused commercial strategies.
Average EV discounts have risen by 53%
Over the past 12 months, discounts on new electric vehicles in the UK have reached an average of £5,006. In contrast, the average discount for new petrol or diesel vehicles remains significantly lower at £2652 – nearly half that available for EVs.
Similarly, EV discounts have increased 53% year-on-year, while internal combustion engine (ICE) powertrains saw a 13% rise over the same period.
JATO analysts attribute the rise in EV discounts to several factors. Increased competition, particularly from Chinese EV manufacturers, has put pressure on established brands to offer more attractive pricing. Additionally, consumer hesitation, driven by concerns over infrastructure and the high upfront costs of EVs, has dampened demand in some markets.
OEMs adopting diverse pricing strategies
Automakers have responded to the competitive environment with varying strategies. At both a brand and model level, there have been significant shifts in incentives, reflecting OEMs’ efforts to boost sales in specific segments.
MG has increased its EV discounts by 106% in 2024, positioning its models as more cost-effective options. This suggests the brand is aiming to increase its EV market share overall.
Meanwhile, premium brands like BMW have taken a more measured approach, with a 14% average increase in discounts. However, certain models, such as the BMW i4, have seen larger discounts. The incentives available for this model increased from £3,488 in 2023 to £7,370 in 2024, marking a 111% rise.
The family vehicle segment is emerging as a key area of growth for EV adoption. Notable models like the MG4 and Hyundai Kona have seen significant year-on-year increases in discounts - 189% and 181%, respectively - highlighting the manufacturers' efforts to appeal to family-oriented buyers.
The role of market intelligence when navigating EV pricing
Matt Crow, Senior Product Manager for Sales Link, summarises the current situation:
“The UK electric vehicle marketplace in 2024 is a complex and evolving environment. Manufacturers are using a variety of strategies to protect volumes and stimulate demand in targeted areas.
“With access to our insights, UK dealerships are better equipped to refine their pricing, understand market shifts, and respond effectively to consumer demand, ensuring they remain competitive in the rapidly changing EV landscape.”
Market intelligence equips dealerships with a clearer understanding of industry trends and emerging opportunities. With real transaction data from JATO’s Sales Link, dealerships can understand their market, and navigate the challenges posed by rising discounts and competitive pressures to meet their objectives.
All data in this article is taken from JATO Sales Link. It details transaction data from sales made by dealerships in the UK market between January 2023 and September 2024. Find out more here - https://info.jato.com/sales-link