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The Department for Transport (DfT) has confirmed that the new Labour Government intends to restore the 2030 zero emission vehicle (ZEV) mandate. It was reported that the DfT aims to “provide certainty” “in due course” to vehicle manufacturers in its plans to reinstate the phase-out of new petrol and diesel cars. However, it is unclear whether this mandate will apply to both passenger cars and light duty vehicles (LDVs). Further details on this initiative are yet to be announced.
A reversal of policy, again
The former Conservative government under Rishi Sunak delayed the ZEV mandate from 2030 to 2035, aligning the UK with the rest of continental Europe. Under the revised scheme 80% of passenger car and LDV sales would have to be 80% by 2030 increasing to 100% by 2035.
Although a reversal of this policy was not included in the King’s Speech, which generally outlines a government’s plans, the Labour government appears intent on reinstating the 100% ZEV mandate by 2030. However, it remains unclear if this will also reverse the ban for LDVs, mainly vans, which may still remain at 2035.
September 2023 Sunak announces 2035 mandate
When Mr Sunak announced the 2035 ZEV mandate, there was pushback from the automotive industry, which had revamped facilities based on the 2030 target. Ford UK Chair Lisa Brankin commented at the time, “Ford has announced a global USD50 billion commitment to electrification, launching nine electric vehicles by 2025. The range is supported by GBP430 million invested in Ford’s UK development and manufacturing facilities… Our business needs three things from the UK government: ambition, commitment, and consistency. A relaxation of 2030 would undermine all three.”
However, the outlook of the EV automotive market has since changed, with slower growth in EV sales and a possible plateau in European EV sales. Consequently, Ford has shelved its plans for achieving a 100% ZEV sales target in Europe by 2030.
How will industry react?
In May, executives from Ford, Stellantis, and VW declared they would not pay fines for exceeding the allowed number of ICE vehicle sales in the UK. If they fall short of their EV sales targets, they plan to reduce the availability of ICE and hybrid cars in the UK, leading to a supply reduction and likely increasing prices for these vehicles in the UK. More recently, in June, Stellantis’ UK managing director suggested that the company might withdraw from UK van production due to the requirements of the ZEV mandate.
A reversal of the mandate would be welcomed by environmentalist groups, but the automotive industry may find it challenging to adapt to yet another change in policy.
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