CEO Update

Watershed regulation can’t come soon enough

31 March 2023 #CEO Update

Government’s consultation on a zero-emission vehicle mandate, a watershed regulation for the UK new car and van market, is finally here. Yesterday’s long-awaited announcement is welcome, and we want regulation that gives consumers choice and affordability while also enabling manufacturers to transition sustainably and competitively. Automotive is firmly on track to drive down emissions from road transport, with the UK new car and van market already moving at pace towards electrification, the result of massive investment by manufacturers and increased consumer demand.

The proposals rightly reflect the UK sector’s diversity, in particular our many small vehicle manufacturers which make low volumes of vehicles, but those that are often high-value, high-tech and others that enable people with disabilities access to mobility. Penalising such firms on the road to zero would have made little sense so this recognition is good news. The late publication, however, does make product planning near impossible, and the continued lack of clarity as to what technologies will be permitted beyond 2030 undermines any attempt to secure future investment.

We must ensure drivers are at the heart of this transition, with assurances that charging infrastructure will be reliable and accessible across the UK. Therefore, measures to boost the charging experience are a step in the right direction, but the fact that contactless credit or debit card payments will not be available on the vast majority of public chargers is a major failing that will significantly disadvantage EV drivers.

While the investment of some £381 million into the Local Electric Vehicle Infrastructure fund is extremely positive, it is still disappointing that, unlike in other countries, there is no commensurate regulation to drive investment into the public network given that paucity of chargepoints remains the biggest barrier to buying an electric vehicle. Ultimately, infrastructure providers must now turn promises into investment and catch up with the commitments already made by the automotive industry.

If the UK is to lead the global race to zero emission mobility, it must go further and faster in unlocking infrastructure investment, bolstering consumer confidence, incentivising EV ownership and helping ensure more of these vehicles are developed and built in Britain. We already have strong fundamentals; a highly skilled workforce, engineering excellence, a sector embracing new electrified vehicle manufacturing and wide-ranging capabilities in the EV supply chain.

February’s growth in UK car production signposts an industry on the road to recovery, with hybrids, PHEVs and battery electric vehicles accounting for two in five cars produced in the month. While commercial vehicle production fell due to supply chain shortages, we expect a return to growth, as new electric van production begins later this year. The challenge now is to scale up this capability, harness the UK’s strengths in advanced automotive manufacturing, low carbon energy and R&D and deliver long-term growth for the sector.

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