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The UK government has announced a consultation on its zero-emission vehicle targets, following complaints from carmakers that the current regime could lead to job cuts as demand for electric vehicles stagnates.
Transportation Secretary Heidi Alexander has given the auto and charging sectors eight weeks to submit their views on existing EV targets including how “existing arrangements and flexibilities work”.
The zero-emission vehicle mandate was developed by the previous Conservative government at a time when electric vehicle sales were expected to take off.
Under current targets, a certain percentage of each automaker’s annual sales must be zero-emission vehicles, rising from 22 percent in 2024 to 80 percent in 2030. Companies face fines if they are not meeting the target of £15,000 for each vehicle. vehicle below the required level.
Electric vehicles accounted for for 18 per cent of the UK car market between January and November this year – well below the 22 per cent threshold set by the mandate.
In November, Stellantis, owner of Vauxhall has blamed electric vehicle rules for its plans to close its van factory in Luton, putting around 1,100 jobs at risk.
Ford also announced it would cut 800 jobs in the UK due to slower-than-expected electric vehicle sales, while Nissan has warned that jobs at its Sunderland plant, Britain’s largest, could be in danger unless the government relaxes its rules on the sale of electric vehicles.
But the government has made it clear that the overall figure for 2030 will not be changed by the new consultation.
Alexander said: “Over recent years our automotive industry has been stifled by a lack of certainty and direction. This government will change that.
The consultation will be divided into two parts: the first will examine which hybrid cars can be included on sale alongside zero-emission models between 2030 and 2035.
The FT previously reported that ministers wanted to allow carmakers to continue selling Prius-style hybrid models – which use a motor and battery in parallel – in the UK until 2035. Unlike “plug-in hybrids”, which have larger batteries, “full hybrids” do not plug in to recharge. On the other hand, conservatives are delighted that gasoline and diesel models will remain on sale.
The second part will focus on flexibilities under the 2030 goal, with officials open to several changes to the rules, including widening the “commercial” loophole that allows automakers to buy credits from their competitors to avoid fines.
Another “borrowing” program under which manufacturers can miss early targets but avoid fines by pledging to exceed their targets in future years is also expected to be extended for a few more years after its scheduled expiration in 2026.
Speaking to the Financial Times, Nicola Walker, head of government affairs at Ford, said the company had called for a “moratorium” on fines in 2025 for companies that failed to meet their targets. However, this would involve changing primary legislation and seems unlikely.
Business Secretary Jonathan Reynolds said: “We are resolute in our mission to help our world-leading automotive industry thrive, and this consultation will look at how we can help manufacturers, investors and the industry as a whole to achieve their goals. »
The changes have been met with dismay by the charge point sector, which has warned that up to £6bn of investment up to 2030 could be at risk if the rules are significantly watered down.
Vicky Read, CEO of ChargeUK, said she hoped the consultation would bring “certainty” to the electric vehicle and charging sectors after “a destabilizing few months, during which the foundations of UK vehicle policy electrical systems have been called into question.
Read urged the government to “keep its cool” and maintain ambitious electric vehicle targets.
Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders, said: “The motor industry welcomes the Government’s review of the end of sale date for cars powered only by petrol or diesel, as well as possible changes in flexibilities around the zero-emission vehicle. mandate.”
He added: “It is imperative that we secure an urgent resolution, with a clear intention to adapt regulations to support delivery, supported by bold incentives to boost demand. »
