Britain's automotive manufacturers are urgently seeking a reduction in electric vehicle (EV) targets and immediate action to lower energy costs, citing intense pressure on the industry. Recent figures from the Society of Motor Manufacturers and Traders (SMMT) show that UK car production fell by 10.6 percent in July compared to the same month last year, with 61,767 vehicles produced. Year-to-date production is down 4.7 percent, totaling 433,523 units.
The industry faces challenges in meeting government mandates for increasing the proportion of EVs sold. Current regulations, known as 'zero-emission vehicle' (ZEV) rules, aim for EVs to constitute 33 percent of sales by 2026 and 80 percent by 2030. So far this year, EVs have accounted for one in four new cars sold in the UK, making the 2026 target appear unlikely.
In response to what it described as 'slower than anticipated' uptake of EVs, the government recently indicated it would relax these targets. Despite this, the SMMT reported a positive trend in the production of greener vehicles, with output of fully electric and hybrid models increasing by 6.8 percent to 25,678 units in July. These electrified models now represent more than 40 percent of all cars manufactured in the UK.
Car manufacturers are also contending with industrial energy costs that are reportedly 60 percent higher than those in competitor European nations. Furthermore, potential new 'Made in the EU' proposals from Brussels could negatively impact the competitiveness of British-made vehicles in continental markets.
Mike Hawes, SMMT chief executive, stated that July's production figures underscore the 'intense pressure' on UK vehicle manufacturers. He attributed the recent decline partly to the standard summer shutdowns and model changeovers, but also highlighted weaker overseas demand and fierce global competition as compounding factors.
'The rise in electrified vehicle production is encouraging,' Hawes said, 'but long-term success depends on making the UK a more competitive place to make and sell vehicles. Meaningful and urgent reform of the ZEV Mandate, reduction of the UK’s sky-high energy costs and negotiations to safeguard free and fair trade with our largest and closest export market are essential to put UK automotive manufacturing back on a path to growth.'