The Business Secretary is set to face MPs amid growing concerns over the car industry’s ability to adapt to plans aimed at increasing the number of electric vehicles.
Jonathan Reynolds revealed a “fast-track” consultation into these plans on Tuesday night, and will follow this up with a statement to the House on Wednesday. He expressed his deep concern to car manufacturers about how policies intended to phase out new petrol and diesel vehicles by 2030 were functioning, and pledged to consult on “a better way forward”, while still maintaining the target.
This comes after Stellantis, the owner of Vauxhall, announced it would shut down its van-making factory in Luton, putting 1,100 jobs in jeopardy, due to what it termed the “stringent” UK zero-emission vehicle mandate.
The Society of Motor Manufacturers and Traders (SMMT) cautioned that the speed of the transition could impact carmakers as demand for zero emission vehicles “failed to meet ambition”. Ford UK’s managing director stated that while the car industry supports targets around electric vehicles, it requires government-backed incentives to encourage their adoption by customers.
Lisa Brankin said Ford has invested “significantly” in the production and development of EVs, with “well over” £350m invested around electrification in the UK. “So we kind of need to make it work,” she told BBC Radio 4’s Today programme.
Under the zero-emission vehicles (Zev) mandate, at least 22% of new cars sold by each manufacturer in the UK this year must be zero-emission, with the threshold rising each year.
The current mandate aims for an 80% target by 2030, with the Government already moving to advance the prohibition on new petrol and diesel vehicle sales from 2035 to 2030, reversing last year’s amendment under Rishi Sunak’s administration. Though the consultation likely won’t tweak the Zev mandate’s figures, it may modify how manufacturers can sidestep fines for missing targets.
In his address to the SMMT, Mr Reynolds assured the industry of the Government’s dedication to the 2030 goal and acknowledged their calls for support during this pivotal shift. Ms Brankin stressed the urgency for a swift consultative process and prompt Government action.
She underlined the critical need for Government-backed stimuli to rapidly encourage electric vehicle uptake, stating: “The one thing that we really need from the Government is Government-backed incentives to urgently boost the uptake of electric vehicles, because without demand the mandate just doesn’t work.”
When queried about her satisfaction with the Government maintaining EV objectives and ceasing diesel and petrol car production contingent on their efforts to spur consumer transition to EVs, Ms Brankin affirmed: “Yes, I think so.”
She added: “As an industry we have repeatedly said that we support the Government’s trajectory and we support the ambition that the Government has set out, it’s just that there isn’t customer demand.”
Fiona Howarth, chief executive of Octopus Electric Vehicles, urged the Government to “hold firm” on its mandate, saying that EVs are cheaper to run than petrol cars for those with a driveway and that private investment would strengthen the public charging network.
She said: “Manufacturers that failed to invest in the future are now facing challenges.
“To secure long term jobs in the sector, the Government must hold firm on the Zev mandate and invest in targeted support for manufacturers committed to the electric transition and jobs in the UK.
“Changing the mandate would mean shooting ourselves in the foot by bowing to the pressure of a few laggard companies.”
Minister Stephen Morgan said the Government would work closely with industry in the UK to make sure its Zev mandate is rolled out effectively and that the required infrastructure, such as charging points, must be put in place to meet the targets.
“It is absolutely right that we’ve got [to have] the right infrastructure in place to make this a suitable journey and an easy journey for motorists to move towards,” he told Sky News.
Asked about the case that people do not want to switch to these cars, he said: “We’ve set out the ambition, we obviously need to take consumers with us.
“I know that Johnny Reynolds would do a good job on this work, and he will also be setting out more detail on this later in the House.”
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