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Highlights
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There are increasing calls for government support for Britain's electric vehicle (EV) industry, as sales are projected to fall short of a mandated target in its inaugural year.
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Carmakers are collectively offering £2 billion in discounts to stimulate sales, yet the market is still lagging behind the government's requirement for 22% of cars sold to be electric.
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The Society of Motor Manufacturers and Traders (SMMT) urges Chancellor Rachel Reeves to introduce measures in the upcoming Autumn Budget to bolster the EV market amid concerns over sustainability and investment.
Calls for government intervention in Britain’s electric vehicle (EV) industry are intensifying as sales threaten to miss a mandated target in the sector's first year, despite significant price reductions from car manufacturers. The Society of Motor Manufacturers and Traders (SMMT) announced on Friday that carmakers are set to collectively provide £2 billion in discounts this year to stimulate electric vehicle sales.
Despite these efforts, there is a looming risk that sales will not meet the government’s new target, which mandates that 22% of all cars sold must be electric. Failure to meet this benchmark could result in fines for manufacturers. In an open letter signed by industry leaders from companies such as Volkswagen, Jaguar Land Rover, Ford Motor Comapny {NYSE:F} , and BMW, SMMT Chief Executive Mike Hawes emphasized the need for Chancellor Rachel Reeves to introduce supportive measures in October’s Autumn Budget.
Hawes stated, “Despite manufacturers spending billions on both product and market support—support that the industry cannot sustain indefinitely—market weakness is putting environmental ambitions at risk and jeopardizing future investment.”
While the SMMT reported a 24% increase in electric vehicle sales last month, reaching a record 56,000 units, this growth has not been sufficient to elevate the overall share of new electric vehicles in the market above the mandated target. As of now, the share sits at 17.8% for the year.
Hawes further cautioned that the market is not expanding quickly enough to meet the mandated targets, stating, “Look under the bonnet and there are serious concerns.” The mandate, which was introduced this year, is scheduled to escalate annually from 22% in 2024 to 80% by 2030, culminating in a phase-out of new petrol and diesel car sales by 2035. The success of this initiative hinges on a robust and supportive framework for the electric vehicle market.
