Govt reviewing flagship EV sale quotas after biggest car production fall in 73 years
Government Evaluates Electric Vehicle Sales Targets Amid Record Production Drop
The UK government is assessing its electric vehicle sales targets, a cornerstone of its environmental strategy. This comes as the country experienced its lowest car output in 73 years, according to recent data.
Ministers are now exploring potential modifications to the Zero Emission Vehicle (ZEV) requirement, which was introduced by the Labour administration in 2024. The policy mandates that automakers achieve annual targets for zero-emission car and van sales, aiming to eliminate new petrol and diesel vehicle sales by 2030.
The quotas are set to rise yearly, targeting 100% zero-emission sales by 2035. Non-compliance carries hefty penalties, with fines of £12,000 per shortfall. For 2024, the threshold was 22%, increasing to 28% in 2025 and 33% for 2026.
“We acknowledge the challenges manufacturers face, but we’ve demonstrated flexibility before. Conversations are underway to shape the ZEV mandate review, with a final report expected by early 2027,” a government representative said.
Despite the production slump, one in four new cars sold last year was electric, marking a 25% year-on-year rise. However, February saw a 17% decline in output compared to the same period in 2025, with total BEV, hybrid, and PHEV production dropping by 3% to 26,629 units.
Labour’s goal is to double annual vehicle production by 2035, aiming for 1.3 million units yearly. This would require significant shifts in manufacturing capacity. The government also granted automakers more flexibility in meeting ZEV goals, following adjustments in April linked to U.S. import tariffs under Donald Trump.
Conservatives have criticized the review, calling it another example of “ideological rigidity” that burdens households with rising energy costs. Shadow transport secretary Richard Holden emphasized the need for a “consumer-focused approach” over the current mandate, which he claims is driven by political priorities.
Key changes include allowing hybrid vehicles to remain on the market until 2035 and exempting smaller manufacturers from the 2030 petrol and diesel phase-out. The government also removed certain incentives in April, such as the excise duty exemption for EVs, and introduced a “pay-per-mile” tax starting in 2028.
Industry groups estimate the ZEV policy has cost automakers £10 billion in the first two years, citing steep discounts to meet quotas. While the mandate has spurred EV adoption, its economic toll on producers has sparked debate about its long-term viability.
