Britain consults on easing electric car rules to save jobs

Britain began a consultation this week to review rules that force automakers to produce more electric vehicles, following industry warnings that the current plan could lead to factory closures and job losses.

The consultation will take views from the industry on changing the so-called Zero Emission Vehicle (ZEV) mandate, which requires automakers to sell a higher proportion of EVs each year, or pay fines.

Carmakers say lower-than-expected EV demand has forced them to spend billions of pounds on discounts to entice customers and meet the sales targets, which have hurt Britain’s appeal as a manufacturing hub.

Last month Vauxhall owner Stellantis (STLAM.MI) said it would shut a van factory in southern England, risking more than 1,000 jobs, partly reflecting the impact of the ZEV mandates.

Britain’s Labour government said it would consult to update the targets without compromising the overall direction of the regulations, which form part of Britain’s wider climate goals.

The consultation will seek views on the restoration of a 2030 deadline to phase out new petrol and diesel car sales and whether vehicles such as hybrid cars can be sold alongside ZEVs.

It will also consider measures to boost consumer demand for electric vehicles.

“We are steadfast in our mission to help our world-leading automotive industry thrive, and this consultation will look at how we can support manufacturers, investors, and the wider industry to reach their targets,” Business Secretary Jonathan Reynolds said.

The auto industry welcomed the consultation, which runs until Feb. 18.

“With the 2025 market looking under even greater pressure, it is imperative we get an urgent resolution, with a clear intent to adapt the regulation to support delivery, backed by bold incentives to stimulate demand,” Society of Motor Manufacturers and Traders Chief Executive Mike Hawes said.