ANALYSIS
Law and behold!
The ZEV mandate is now in force in the UK, providing a pathway for all new cars and vans to be zero emission by 2035. But, as Natalie Middleton explains, not everyone is happy about it
The long-awaited ZEV mandate has now passed into law, requiring all new cars and vans to be zero emission by 2035. Only confirmed in September 2023, it levies increasingly stringent EV quotas on manufacturers in the run-up to the ICE ban.
Following the Government’s “pragmatic decision” to push the ban back to 2035, the ZEV mandate is now seen as the single biggest mechanism to deliver decarbonisation of cars and vans on British roads. This “pathway” to the ICE ban sets out interim zero emission sales targets up until 2030 for individual OEMs. For 2024, this is set at 22% of all new cars sold, rising every year thereafter until a target of 80% at 2030. Van targets are softer, reflecting the challenges of electrification in this sector; the goal is for 10% this year and 70% in 2030. Both have the same 100% target by 2035 – although the interim targets from 2030 will be announced later.
According to the Government, the mandate is the largest carbon-saving measure in its Net Zero Strategy – and means the UK now has the most ambitious regulatory framework for the switch to electric vehicles of any country in the world.
The ZEV mandate applies in England, Wales and Scotland. It’s expected that Northern Ireland will join the mandate when the Assembly is able to pass the required legislation. In the interim, it retains a scaled version of the existing CO₂ emissions regulation for new cars and vans.
The Department for Transport (DfT) said the new laws would “help households make the switch to electric, supporting growth of EV sales in the second-hand market and incentivising charging to roll out more widely across the country”.
But it’s not been universally greeted – and an exclusive article in The Guardian has revealed that several of the world’s biggest carmakers lobbied for the rules to be weakened or delayed.
Major carmakers including JLR (formerly Jaguar Land Rover), Toyota, Nissan and Stellantis backed changes or delays of one form or another, saying it was too late to revise their plans. Aston Martin Lagonda and McLaren also argued that they couldn’t meet the targets. And the final ZEV Mandate exempts manufacturers selling fewer than 2,500 non-ZEV vehicles from its provisions as well as special purpose vehicles (SPVs). There are additional credits for ZEVs used in car clubs. Meanwhile, Tesla, Volkswagen and Ford called for the ZEV mandate to be tougher.
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According to the Government, the ZEV mandate is the largest carbon-saving measure in its Net Zero Strategy
There have been wider industry worries though, chiefly in three areas. Concerns about the issue of securing grid connections to maintain charge point infrastructure rollout also remain ongoing. That’s despite the Government’s pledge in the Autumn Statement to support grid reforms to cut connection waiting times.
Private driver demand for EVs also remains problematic. The Society of Motor Manufacturers and Traders (SMMT), among others, has said that the mandate means the UK still retains the most ambitious transition timeline of any major market but without any private consumer incentives.
The BVRLA meanwhile has warned that the mandate could artificially fuel the market for new EVs and therefore create a subsequent glut in the used sector – further impacting leasing company residual values.
David Borland, EY UK & Ireland automotive leader, summed up the challenges. “The disparity between the timing of the ZEV Mandate and the delay to the ICE vehicle sales ban will continue to represent one of the most marked challenges to the UK’s EV transition going forward, as OEMs attempt to provide a more compelling proposition to consumers to make the switch. And with question marks remaining around the residual values of EVs, while the current profitability of EV sales appears stretched, the road ahead will certainly be a complex one.”
