Carmakers in the UK warned on Tuesday of nearly £6 billion ($7.52 billion) in combined discounts and compliance costs to meet the government’s 2024 electric vehicle (EV) sales mandate.
The Society of Motor Manufacturers and Traders (SMMT) emphasized the challenges in a statement, with CEO Mike Hawes cautioning that “profitability and viability are in jeopardy and jobs are on the line.”
The Labour government, led by Prime Minister Keir Starmer, announced plans to consult on revising the zero-emission vehicle mandate but reiterated its commitment to a 2030 deadline for phasing out new petrol and diesel vehicle sales.
Stellantis, meanwhile, revealed plans to close its Vauxhall van plant in southern England, highlighting industry-wide pressures. The SMMT estimates automakers will offer £4 billion in discounts this year to boost EV sales, falling short of the mandated 22% EV market share.
Compliance costs are projected to add another £1.8 billion burden to the sector. “The mandated targets have given manufacturers no option but to subsidize sales,” the SMMT noted, calling for policy adjustments to safeguard industry stability.
