CEO Update

Government actions speak louder than words

12 October 2018 #CEO Update

We were surprised and disappointed to hear this week that the government has decided to alter its plug-in car grant system drastically, excluding anything that does fewer than 70 miles on a full charge. It’s astonishing to think that merely three months after the government published its Road to Zero strategy amid great fanfare, it would take away the primary incentive for buyers to take up ultra low emission vehicles just as it was beginning to have an effect.

With sales of diesel in decline and fleet average CO2 levels rising, growing sales of AFVs will be one of the most important ways to meet challenging targets. Manufacturers have spent billions developing clean diesel and petrol technologies, introducing a wider choice of plug-in hybrid vehicles, improving the range of BEVs and developing other solutions such as hydrogen fuel cell vehicles. For these to take market share, however, we need infrastructure and incentives to overcome the price premiums that accompany any new technologies. Consumers and the industry need consistency of support – today’s announcement is the complete opposite.

A Brussels discussion that puts the plug-in car grant discussion in particularly sharp relief is the proposal for future CO2 reductions, which was brought to a meeting of the EU28 environment ministers this week. The original proposal from the European Commission was based on an impact assessment and called for a 30% reduction from the 2021 levels by 2030. That was upped to 40% by MEPs and the EU28 representatives ultimately met in the middle with a 35% proposal. These are incredibly tough targets and need the support of all stakeholders – not just the industry – if they are to be achieved.

Government has pledged to match the EU CO2 with a UK target in the event of a ‘no deal’, so this will pose a significant challenge for our industry irrespective of the future, a challenge compounded by the recent – and unfair – bashing diesel has received and now the removal of support for cleaner plug-in hybrid cars. If Government wants to meet its own – and legally binding – climate challenge goals and the industry is to stand any chance of meeting its targets while maintaining jobs and international competitiveness, consistent incentives for consumers and infrastructural investment are non-negotiable.