Carmakers in the United Kingdom have raised concerns that maintaining current regulations on electric vehicle (EV) sales could jeopardize jobs and investment in the sector. According to internal documents obtained by Fast Charge, manufacturers such as BMW, Jaguar Land Rover (JLR), Nissan, and Toyota argue that these rules could result in losses amounting to hundreds of millions of pounds. The documents show these companies have been lobbying for a more gradual transition away from fossil fuels, suggesting that the current framework would hinder their ability to invest in the UK automotive market.
The UK government previously set forth rules requiring automotive manufacturers to increase their sales of electric vehicles annually, in line with the zero emission vehicle (ZEV) mandate. This initiative aims to promote a significant reduction in carbon emissions. As of July 2023, electric car sales have surged, making up more than a fifth of the market, with every carmaker meeting their targets last year. Despite this progress, manufacturers have expressed concerns over inflated expectations regarding the demand for battery-powered vehicles, leading to price reductions that they argue are unsustainable.
Manufacturers Call for Flexibility
In a recent response to proposed changes, JLR emphasized that maintaining the current sales rules would “materially damage UK producers’ ability to invest in vehicle lines.” The previous Conservative government mandated an increasing percentage of electric vehicle sales or risked incurring hefty fines. In April 2024, following intense lobbying, the Labour government introduced new “flexibilities” that would allow carmakers to continue selling petrol vehicles, a move that has sparked debate among industry stakeholders.
BMW noted that the UK automotive landscape has become increasingly challenging since Brexit, with the ZEV mandate perceived as more rigorous than similar regulations in the European Union or California. The company stated, “The UK has already become a far more difficult place to produce vehicles now post-Brexit, and a further challenging market environment could ultimately damage competitiveness and have a detrimental effect on the 8,000 jobs – up to 50,000 with supply chain – we currently retain in the UK.”
Japan’s Toyota, which operates factories in Derbyshire and North Wales, warned that penalties for non-compliance could total hundreds of millions of pounds for each manufacturer, posing a significant risk to employment and investment across the sector. The world’s largest carmaker by volume has been focusing on hybrid vehicles and has successfully lobbied for hybrid sales to be permitted until 2035 in the UK.
Nissan, which has its sole European factory in Sunderland, echoed these sentiments, stating that without additional flexibility, manufacturers could face “critical levels” of costs that would divert funds away from vital research and development for battery electric vehicles in the UK.
Industry Response and Future Implications
JLR has raised concerns about a rule allowing carmakers to purchase “credits” from competitors that exceed their electric vehicle sales targets, suggesting that this system disproportionately benefits foreign manufacturers, particularly those in China, which dominate the electric car market. Advocates for stricter emissions regulations argue that such rules effectively drive the automotive industry towards greater electrification.
Ben Nelmes, the chief executive of New Automotive, a group advocating for the transition to electric vehicles, stated, “The car industry’s own consultation responses confirm that the ZEV mandate’s 2024 targets were met, proving the policy is a powerful driver of change. The focus should now shift to accelerating the transition, as this data shows the UK automotive industry is capable of delivering cheaper, cleaner transport.”
Tom Riley, author of the Fast Charge newsletter, criticized the automotive industry’s stance, saying, “Carmakers love to wave the Union Jack when it suits them, but threatening UK jobs and investment to weaken climate policy is a cynical tactic.”
Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders (SMMT), emphasized the unprecedented challenges facing the automotive sector, particularly in the shift to electric vehicles amidst a subdued economic backdrop and fierce global competition. He supported the government’s decision to revise previous targets, cautioning that such ambitious goals could lead to “decarbonisation at the cost of de-industrialisation.”
A spokesperson for BMW reiterated the company’s commitment to UK and global climate targets but argued that consumer demand should ultimately dictate the pace of transition to zero-emission vehicles. A representative for Nissan welcomed the government’s pragmatic approach to the lower-than-expected uptake of electric vehicles, highlighting the introduction of consumer incentives designed to align demand with the ZEV mandate requirements.
JLR and Toyota declined to comment on the matter.
