Ford UK is calling for urgent government financial incentives to drive the adoption of electric vehicles (EVs), as the automotive industry grapples with increasing pressure to meet ambitious sales targets. Lisa Brankin, Chair and Managing Director of Ford UK, emphasized the need for higher demand to ensure the success of government mandates requiring automakers to produce and sell more electric cars.
In an interview on BBC Radio 4’s Today programme, Brankin stated, “We urgently need government-backed incentives to accelerate the uptake of electric vehicles.” She also highlighted Ford’s substantial investment in electric vehicle production in the UK, amounting to over £350 million, underscoring the company’s commitment to the EV transition.
These remarks come at a time of rising tension between UK car manufacturers and the government, particularly in light of the planned phase-out of petrol and diesel cars. Recently, Stellantis (the parent company of Vauxhall) announced the closure of its Luton plant, putting 1,100 jobs at risk. This decision is partly due to the pressure of meeting EV sales targets, reflecting broader challenges within the industry.
Government Mandates and Industry Strain
Business Secretary Jonathan Reynolds expressed deep concern over Stellantis’s decision, calling it a “dark day for Luton.” Ford also revealed plans to cut 800 jobs over the next three years, citing the rising competition in the electric vehicle market and the pressure to meet EV sales quotas as key factors.
The UK government’s commitment to phasing out petrol and diesel vehicles by 2030 remains intact, but there are ongoing debates about how to balance environmental goals with economic and industry needs. Reynolds, responding to Stellantis’s plant closure, blamed the previous government’s handling of the situation, calling it a result of "extreme frustration" within the automotive sector.
Shadow Business Secretary Andrew Griffith, however, criticized the 2030 EV target, describing it as a “jobs killer.” He argued that the government’s policies are exacerbating challenges in the automotive sector, with Stellantis’s decision being a direct consequence of these regulations.
Increasing EV Sales Targets and Penalties
The UK government recently adjusted its timeline for the phase-out of petrol and diesel vehicles, moving the deadline from 2030 to 2035. However, stricter penalties for non-compliance remain in place. Currently, car manufacturers must ensure that 22% of their car sales and 10% of their van sales are zero-emission vehicles (ZEVs). Manufacturers who fail to meet these targets face hefty fines of £15,000 per car sold under the target.
By 2025, these targets are set to increase to 28% for cars and 16% for vans, with even stricter regulations expected in the following years, culminating in a full ban on new petrol and diesel cars. Labour has vowed to reinstate the 2030 target as part of its broader climate change strategy but has promised further consultations on how to implement the policy effectively.
Industry Concerns Over Electric Vehicle Demand
Despite a growing shift towards electric vehicles, the demand for EVs has not met expectations. Car manufacturers argue that they are being forced to offer large discounts or subsidize sales from rival companies—such as Tesla and BYD—that exclusively produce electric vehicles. These companies, which don’t have manufacturing operations in the UK, benefit from a growing demand for EVs, putting additional strain on UK-based carmakers.
While the number of electric cars registered in the UK has risen, accounting for 1 in 5 cars in October 2024, many industry insiders point out that this surge is largely driven by unsustainable pricing strategies and discounting. At a recent event hosted by the Society of Motor Manufacturers and Traders (SMMT), Business Secretary Reynolds acknowledged the concerns about current EV policies, stating, “I don’t believe the policies we’ve inherited are working as intended.”
Proposed Solutions and Industry Calls for Government Support
In response to these challenges, several solutions have been proposed, including allowing car manufacturers to transfer sales credits between cars and vans or granting credits for UK-made EVs sold abroad. The SMMT has called for immediate government intervention to protect the UK automotive sector, warning that weak demand for electric vehicles and the pressure to meet sales targets could jeopardize business viability and jobs.
Nissan, which produces electric vehicles at its Sunderland plant, has also raised concerns, stating that the current regulatory framework is "undermining the business case" for EV manufacturing in the UK. The company warns that failure to address these issues could lead to the loss of thousands of jobs and billions of pounds in investment.
Conclusion
The UK’s ambitious electric vehicle targets are facing growing resistance from car manufacturers, who argue that without stronger demand and government-backed incentives, the industry may struggle to meet its EV goals. As manufacturers navigate the shift to electric mobility, the call for a more balanced approach, including financial support and policy adjustments, has never been more urgent.
Source: bbc.co.uk
