The pushing back of the deadline of a ban on the sale of new diesel and petrol cars will disrupt the recovery of the new car market in the next few years, one of Britain’s largest car dealerships has warned.
Robert Forrester, the CEO of Vertu Motors, which operates under brands such as Bristol Street Motors and Macklin Motors, said that “confusing” net zero policies risk dampening demand in the car market.
Last month, Prime Minister Rishi Sunak announced that the ban on the sale of new diesel and petrol cars will be enforced in 2035, extending its original deadline of 2030. The new date puts the UK in line with other countries, including France, Germany, Sweden, and Canada.
The zero-emission vehicle (ZEV) mandate, however, still requires 80 percent of new cars sold in Britain to be zero emission by 2030. This will increase to 100 percent by 2035, the government said in a statement.
The Department for Transport has argued that an extension will provide “provide certainty for manufacturers and will help families make the switch to electric.”
Mr. Forrester said that the demand for new electric vehicles (EV) from retail customers has remained “muted” in recent months.
“The government’s confusing messaging may further contribute to this,” he said.
Manufacturers are trying to stimulate retail demand by offering discounts and lower finance rates.
“These market dynamics combined with the ZEV mandate have the potential to disrupt the recovery of the new car market in the next few years,” Mr. Forrester said.
The government mandate requires 22 percent of new cars sold in 2024 to be zero emission.
From 2024, an electric vehicle shipped between the UK and the European Union will need to have 60 percent of its battery value and at least 45 percent of its overall parts value sourced from within the two regions. Otherwise, carmakers will face 10 percent tariffs under the post-Brexit Trade and Cooperation Agreement.
Mr. Forrester says that may result in higher prices for consumers.
Seeds of Doubt
Last month, the Society of Motor Manufacturers and Traders (SMMT) reported a slowdown in demand for EVs by retail buyers. The SMMT cited the cutting of financial incentives and the overall uncertainty over maintaining EVs among the reasons.Private motorists are affected by higher electricity costs, the still-developing UK public charging infrastructure, and the removal of the plug-in car grant scheme in June 2022.
Under the scheme, private owners could get up to £1,500 off an EV, but the government ended the programme to focus on “improving electric vehicle charging.” Sales to private buyers have then fallen from more than 1 in 3, to less than 1 in 4, the SMMT reported.
“Only half of people could see how an EV could fit into their lifestyle as it is,” Auto Trader commercial director Ian Plummer said.
He said the government should be addressing people’s concerns over affordability and charging “rather than planting seeds of doubt.”
Reacting to Mr. Sunak’s announcement, Mr. Plummer said it “has only served to remove trust and confidence in the UK market.”
“The PM has left the industry and drivers high and dry by sacrificing the 2030 target on the altar of political advantage,” he said.
The government maintains that its new plan will make it easier and more realistic for families to own an electric vehicle.
“Our mandate provides certainty for manufacturers, benefits drivers by providing more options and helps grow the economy by creating skilled jobs,” said Transport Secretary Mark Harper, in support of the PM.
UK motorists will manage the transition to EVs, according to the new deadline, if they have “the right information, infrastructure, and incentives,” the British motoring association AA said.
