UK Changes Zero Emission Vehicle Rules In Tariff Response
Road transport remains the UK's largest source of greenhouse gas emissions, contributing 28% of the nation’s total in 2022.
The UK has committed to cutting overall emissions by 68% and reaching net zero by 2050, meaning emissions from road transport must fall significantly to help achieve these targets.
In response to US President Donald Trump’s introduction of a 25% tariff on cars imported to the United States, the UK government has revised its Zero Emission Vehicle (ZEV) Mandate. The updated policy allows hybrid vehicles to remain on sale until 2035, with exemptions for small-scale manufacturers.
Previously, the government had planned to end the sale of new petrol and diesel cars by 2030, requiring all new vehicles to be fully electric. Under the new rules, however, internal combustion engine vans and plug-in hybrid light commercial vehicles may also continue to be sold until 2035.
Prime Minister Keir Starmer said: “Global trade is being transformed so we must go further and faster in reshaping our economy and our country through our Plan for Change.
“I am determined to back British brilliance. Now more than ever UK businesses and working people need a government that steps up, not stands aside.
“That means action, not words. So today I am announcing bold changes to the way we support our car industry.
“This will help ensure home-grown firms can export British cars built by British workers around the world and the industry can look forward with confidence, as well as back with pride.”
The impact of changes to the ZEV mandate
The changes come after a consultation launched by the Department for Transport in December 2024, which concluded in February.
The previous mandate outlined the percentage of new car sales that must be electric vehicles up to 2030, but these targets are now being relaxed to allow a greater number of petrol and hybrid cars to be sold in the later years.
Hybrid models, such as the Toyota Prius and Nissan e-Power, will remain available for purchase until 2035, giving the industry more time to adapt.
The government has pledged tax incentives worth hundreds of millions to support the shift to electric vehicles and maintain consumer demand.
This is in addition to £2.3bn (US$2.9bn) being invested in strengthening UK manufacturing and expanding the charging network.
Smaller manufacturers, including McLaren and Aston Martin, will be exempt from meeting the mandate targets.
Transport Secretary Heidi Alexander said: “We will always back British business.
“In the face of global economic challenges and stifled by a lack of certainty and direction for too long, our automotive industry deserves clarity, ambition and leadership. That is exactly what we are delivering today.
“Our ambitious package of strengthening reforms will protect and create jobs – making the UK a global automotive leader in the switch to EVs – all the while meeting our core manifesto commitment to phase out petrol and diesel vehicles by 2030.”
The UK’s automotive sector
Employing more than 150,000 people, the UK automotive industry significantly contributes to the economy, generating £19bn (US$24.5bn) annually.
The UK held the largest electric vehicle market share in Europe in 2024, ranking third globally with more than 382,000 EVs sold.
The country’s public charging network includes more than 75,000 charge-points, with a new one installed every 29 minutes.
Energy Secretary Ed Miliband said: “It is very important that the government has strengthened our commitment to our world leading EV transition plan.
“This plan will benefit UK consumers by expanding the market for cars that are cheaper to run. And it will support our domestic manufacturing so we can seize this global opportunity.”
In 2024, the UK exported more than 100,000 cars to the United States, meaning President Trump’s 25% import tariff could have a significant impact.
Jaguar Land Rover (JLR), the maker of Jaguar, Land Rover and Range Rover vehicles, is headquartered in Coventry and operates manufacturing facilities throughout England.
Sales to the US make up almost a quarter of the company’s overall exports.
JLR has announced it will temporarily halt shipments to the US while it assesses how best to manage the financial burden of the new tariffs.
A JLR spokesperson said: “The USA is an important market for JLR’s luxury brands.
“As we work to address the new trading terms with our business partners, we are enacting our short-term actions including a shipment pause in April, as we develop our mid to longer-term plans.”
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