Car firms in pre-budget plea to Chancellor

Car industry bosses have called for electric vehicles to be made tax-free - as demand fell by 2.9% last month.

Some 79,594 new cars were registered in February compared with 81,969 during the same month in 2019, according to the Society of Motor Manufacturers and Traders (SMMT).

The trade association blamed weak consumer confidence and confusion over what fuel technology to buy.

It called for the Chancellor to use next week's Budget to remove VAT from all new battery electric, plug-in hybrid electric and hydrogen fuel cell electric cars.

Such a move could cut the purchase price of an average family battery-powered runaround by around £5,600.

Removing VAT could boost sales of battery electric cars alone to nearly one million, according to the SMMT.

February's decline in car sales was driven by a 7.4% drop in demand from private consumers.

Sales of diesel and petrol models were down 27.1% and 7.3% year-on-year.

But it was better news for zero-emission-capable cars, with sales of battery electrics up more than threefold on February last year to 2,508 cars in the month, and plugin hybrids up 50% to 2,058 vehicles.

Despite the rising numbers, their market share of 5.8% of sales remains low, the industry body said.

SMMT chief executive Mike Hawes said: "Another month of decline is especially concerning.

"Next week's Budget is the Chancellor's opportunity to reverse this trend by restoring confidence to the market and showing that government is serious about delivering on its environmental ambitions.