Skoda has called for more support to be given to manufacturers in rolling out a range of affordable electric models, warning that many brands are struggling to turn a profit.
Whilst private sales recently saw a slight slump in sale, the overall number of electric cars on the roads continues to grow, with a number of manufacturers introducing entry-level models at affordable prices.
However, speaking to the motoring publication Auto Express, Martin Jahn, Head of Sales and Marketing at Skoda, highlighted that these models do not make sufficient profits to be sustainable.
He explained: “As CO2 limits are going down, we need to increase the number of electric cars sold, so it’s only natural that we are trying to decrease the price.
“Unfortunately, the costs are not decreasing as fast, so it is affecting the profitability of electric cars. Profitability of electric cars is a challenge for everybody; there are very few brands who make money with electric cars.”
The Government recently announced that they are to bring the proposed ban on new petrol and diesel cars back forward to 2030. Whilst drivers will still be able to drive fossil fuel-powered models after that date, manufacturers will only be able to sell new EVs and some plug-in hybrids.
To encourage manufacturers to prepare for a petrol and diesel car ban, the Government is enforcing an EV quota, which currently requires 22 percent of vehicles sold by each manufacturer to be fully electric else they risk serious fines.
Whilst supporters claim the quota and mandate are helping manufacturers to take action to cut the emissions produced by their new models, others have argued it is putting financial strain on companies that could drive up future prices and create a reliance on models made in China.
Martin highlighted that, in order to make cheap electric cars profitable, more research will need to go into making battery packs more affordable and efficient.
He added: “If more than 50% of our cars are electric, and we still have this low profitability, then it will become unsustainable. So how do you make them more profitable?
“The battery is what drives the cost of the electric car, so we have to work on the battery costs. We cannot and we do not want to sacrifice quality for the customer.”
Currently, the cheapest fully-sized electric model on the market is the Dacia Spring, a compact city car which retails from £14,995. However, a number of other manufacturers are introducing larger electric models with similar prices to petrol alternatives in the segment.
This includes Skoda, who launched the Elroq compact crossover at the Paris Motor Show. Priced from £31,500, it costs around £5,000 less than many of its electric rivals whilst offering a range of up to 348 miles per charge on the more premium models.
Standard equipment includes a set of 19-inch alloy wheels, a 13-inch touchscreen, and a rear parking camera. However, high-end models also feature keyless entry, heated front seats and, adaptive cruise control.
