The Tesla Model 3 has emerged as a dominant player in the UK automotive market, securing the position of the second best-selling car in 2021.
- Despite a global microchip shortage impacting car production, Tesla’s sales figures remained robust with nearly 36,000 vehicles delivered in the UK in 2021.
- The Model 3’s success is largely attributed to its appeal as an executive company car, bolstered by favorable tax incentives for zero-emission vehicles.
- The rise in electrified vehicle registrations aligns with growing market trends, with one in four new vehicles registered being electric or hybrid.
- Public charging provisions are lagging behind the surge in electric vehicles, presenting a challenge for continued growth in the sector.
The Tesla Model 3’s rise to the second best-selling car in the UK marks a notable shift in consumer preferences towards electric vehicles. Despite the ongoing global shortage of microchips, which has severely constrained car production, Tesla delivered a significant number of vehicles, pointing to robust demand and strategic leasing deals that have bolstered its presence in the market.
Data shows that Tesla delivered nearly 36,000 vehicles in 2021, a 40 percent increase from the previous year. This growth is remarkable considering the UK car market overall was down 30 percent compared to usual expectations, with only 1.65 million registrations, slightly above 2020’s figures during the economic downturn.
A key factor in the Model 3’s success is its widespread adoption as an executive company car, thanks in part to attractive tax incentives. Companies benefit from a 100 percent tax deduction on the car’s cost in the first year, along with exemptions from vehicle excise duty and low emission zone charges. For drivers, the benefit-in-kind tax is a mere 1 percent, significantly lower than the 25 percent rate applied to conventional vehicles.
The rise in electrified vehicle registrations highlights a broader trend, with electric and hybrid cars making up a quarter of all new car sales in the UK. Battery-powered vehicles accounted for 11.7 percent of the market, while plug-in hybrids and self-charging hybrids comprised 7 percent and 8.9 percent, respectively.
Despite these positive trends, the provision of public charging infrastructure has not kept pace with demand. As the number of electric vehicles on the road increases, the ratio of vehicles to charging points has worsened, from one charger per 11 plug-in cars in 2020 to one per 16 vehicles in 2021. Industry leaders stress that supporting infrastructure must improve to sustain growth.
Looking ahead, the Society of Motor Manufacturers and Traders projects that electric vehicle sales will surpass diesel, although supply and infrastructure challenges remain critical. The market must address these issues to maintain consumer confidence and support the transition to electrified transport.
The trajectory of Tesla in the UK exemplifies a significant shift towards electric vehicles, though infrastructure challenges persist.
