Update on electric vehicle sales in major alert for drivers

Sir Keir Starmer is reportedly set to dismantle one of Britain’s key green motoring initiatives, following growing concerns it would threaten jobs and increase costs for drivers.

In a significant departure from Labour’s net zero emissions strategy, ministers are expected to ease regulations forcing carmakers to sell progressively higher numbers of electric vehicles. The change is believed to be due to concerns expressed by industry leaders, unions and business ministers that existing targets are unachievable and threaten one of Britain’s most crucial manufacturing industries.

Current regulations state that 80% of all new cars sold in the UK must be fully electric by 2030. However, reports indicate that this target could be significantly reduced to just 50%. The development marks a blow for Energy Secretary Ed Miliband, who has championed the rapid shift to electric vehicles as a central part of Labor’s quest to net zero emissions.

Industry figures have consistently warned that regulations push manufacturers to resort to costly rebate programs to convince hesitant consumers to switch to battery-powered vehicles. Companies that fail to meet government quotas face penalties of up to £12,000 for each vehicle sold above the permitted threshold.

The industry estimates the policy has already cost manufacturers around £10 billion in its first two years through incentives, rebates and compliance requirements.

The zero-emission vehicle (ZEV) mandate was introduced by Boris Johnson’s government and came into force in 2024. It required 22% of car sales to be electric in its first year, gradually increasing each year until reaching 80% in 2030.

This year is also expected to mark the end of sales of new petrol and diesel cars in Britain. Industry executives have warned that the pace of transformation is outpacing consumer appetite, despite growing enthusiasm for electric vehicles.

The threat of factory closures and layoffs appears to have been a crucial factor in Starmer’s decision to intervene.

Sharon Graham, general secretary of the Unite union, recently warned that the policy was “contributing significantly to the loss of jobs in Britain’s automotive sector”.

She said: “This is a clear fact. The targets must be radically reduced. If the government stands idly by, it will be responsible for the decimation of the car industry.”

The UK automotive sector generates around £25 billion a year for the economy, supporting 183,000 direct jobs and an additional 600,000 roles across the supply chain.

Labor MP Liam Byrne, chairman of the Business and Trade Select Committee, also warned ministers that manufacturers are investing billions of pounds to subsidize electric vehicle sales in a bid to meet government targets.

The anticipated changes would align Britain more closely with the strategy adopted in Europe. The European Union has already relaxed its own plans, replacing rigid targets for electric vehicle sales with broader targets for reducing carbon emissions and giving more prominence to hybrid and traditional vehicles beyond 2030.

Nonetheless, environmental activists and charging industry executives responded with fury to suggestions of removal. Simon Smith, chief executive of charging specialist Voltempo, argued that diluting the mandate would benefit the “slowest” within the industry.

He informed the Sunday Times that drivers are gradually opting for electric vehicles as they can reduce operating expenses and insulate themselves from unpredictable oil prices. The government is expected to launch a consultation on the proposed changes in the coming weeks.

Any reform would further require approval from the devolved administrations, creating the possibility of a political clash with ministers in Scotland and Wales over the future trajectory of the UK’s green transport strategy.