Soaring energy costs threaten to unplug electric car revolution

Rising energy costs threaten to sabotage Boris Johnson’s plans for an electric vehicle revolution, car industry chiefs have warned.

Manufacturing electric cars requires large amounts of energy, while higher bills could also deter drivers from switching from petrol-powered models.

Mike Hawes, the chief executive of the Society of Motor Manufacturers and Traders, said that of all the challenges facing the industry, “the most disturbing one at the moment is obviously rapidly rising energy costs”.

“Already before this price volatility in the UK, we had among the highest energy costs in Europe, and that fundamentally undermines our competitiveness, so times are tough,” he added.

The UK makes seven combustion engine cars for every 10 bought in the country, while for electric cars that number slips to four, said former Aston Martin boss Andy Palmer, who now leads electric bus company Switch. “Put simply, we’re exporting our jobs,” he warned.

The Government has been trying to encourage car makers to produce more electric vehicles in the UK, particularly in so-called Red Wall constituencies in the North of England that voted Conservative at the last election.

Germany, China and the US are pushing ahead with dozens of “gigafactories” to produce state of the art batteries to power modern electric cars.

Proponents of plans to build gigafactories in Britain argue that batteries are too heavy to be economically viable to import from abroad.

The UK was the third-biggest car producer in the world in the 1950s but has slipped to 17th place today.

Raw material costs and chronic shortages of parts are also dogging car makers, and leading to more expensive prices on the forecourts.

Separately, BP is set to spend £ 1bn on charging points in the UK, the Financial Times reported. BP did not respond to a request for comment.

BP has said it plans to have 16,000 fast charging points in the UK by the end of this decade, up from 8,000 today.

Last year the UK has about 16 electric vehicles for every public standard charger, but that ratio was likely to worsen to about 32 EVs per charger this year, with significant regional variations, the SMMT said.

Mr Hawes warned: “Things are getting worse because of that pace of market transition for EVs sales. We need the infrastructure to catch up.”

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