UK Government Reevaluates EV Sales Mandate Amid Industry Struggles
The UK government is reassessing its ambitious electric vehicle (EV) sales mandate as automakers warn they may fall short of this year’s targets. Business and Trade Secretary Jonathan Reynolds announced plans to consult with manufacturers to develop a more achievable strategy, according to a report by Bloomberg.
Current EV Targets and Industry Challenges
The mandate currently requires 22% of new cars and 10% of vans sold by automakers to be zero-emission by year-end. While the industry briefly exceeded this threshold in a single month, maintaining consistent compliance has proven challenging despite billions of pounds in EV discounts.
Factory Closures and Industry Setbacks
Reynolds’s announcement comes on the heels of Stellantis’s decision to close its Luton van factory, resulting in 1,100 job losses. Production of electric vans will transition to the company’s Ellesmere Port facility. This move highlights the difficulties faced by the UK’s auto sector, which is contending with slowing EV demand and fierce global competition.
Other automakers are also scaling back operations. Nissan, the UK’s leading manufacturer, has reduced its forecasts and announced global job cuts. Jaguar Land Rover has postponed new vehicle sales under the Jaguar brand until 2026 to focus on its transformation efforts. Ford, meanwhile, is planning to cut 4,000 European jobs, primarily in the UK and Germany, following its closure of the Bridgend, Wales factory in 2020, which affected 1,644 employees.
Reynolds Acknowledges Industry Challenges
“This industry is facing a greater set of challenges today than at any point in the last 50 years,” Reynolds stated. “The news last week from Ford, and what I received from Stellantis today, only reinforces the scale of those challenges. Yet, it remains deeply painful.”
Consumer Hesitation Slows EV Adoption
Despite aggressive discounting, UK consumers are adopting EVs slower than anticipated. The Society of Motor Manufacturers and Traders (SMMT) estimates that automakers will offer £4 billion ($5 billion) in EV incentives this year—a strategy SMMT CEO Mike Hawes deemed unsustainable.
“We’re building them, but they’re not being bought in sufficient numbers,” Hawes explained. “We cannot incentivize this market alone.”
As the UK government considers revising its EV targets, automakers and policymakers alike must navigate an increasingly complex and competitive landscape.
