UK set to cut EV sales target by a quarter, easing pressure on carmakers

Ministers are expected to cut the UK's electric vehicle sales target for 2030 by about a quarter this week, handing relief to carmakers and setting up a fight with Labour MPs over the government's largest decarbonisation policy. Louise Haigh, the de facto deputy prime minister, will finalise the plan after a crunch meeting in Downing Street on Wednesday, according to government sources.

The decision settles a long-running dispute between the transport, energy and business departments. It lands just as Prime Minister Andy Burnham prepares to travel to his first Cop summit, where he and Foreign Secretary Ed Miliband plan to champion electrification globally.

What is at stake in the mandate?

Under rules introduced by the last Conservative government, carmakers must sell only EVs by 2035, with the required share rising gradually to 80% of new sales by 2030. The policy is projected to deliver nearly 14% of all emissions reductions the UK has pledged for 2028-2032 — more than any other single measure.

Carmakers have argued for years that the interim targets are unattainable, blaming higher inflation and the squeeze on living standards. The Society of Motor Manufacturers and Traders says the industry will miss this year's 33% target by a wide margin: battery EVs accounted for 26.6% of new car sales in the first ten months of the year. Those headline figures, however, ignore existing exemptions that let manufacturers avoid fines by selling more hybrids or banking future EV sales against current shortfalls.

Mike Hawes, the SMMT's chief executive, said: "The gap between demand and mandated targets continues to widen. Meaningful change to the trajectory, alongside expanded flexibilities throughout the regulation, is essential to bridge that gap, safeguard jobs and investment while keeping the UK's zero emission transition on track."

How did Whitehall split?

The government launched a review in August with five options: keep the mandate unchanged; hold the 2030 target at 80% but extend flexibilities by four years to 2034; or cut the interim target to 70%, 60% or 50%. Business Secretary Jonathan Reynolds pushed for the deepest cut, to 50%. Transport Secretary Heidi Alexander is believed to favour roughly 60%, while Energy Secretary Miatta Fahnbulleh and her predecessor Ed Miliband are understood to want the 80% target kept intact.

Burnham would normally arbitrate, but he has recused himself because his wife, Marie-France van Heel, advises the board of Be.EV, the Manchester-based charging network. Government insiders say Haigh will probably sign off on a 2030 target of about 60% and extend the flexibilities to 2034. She has told colleagues she does not want departments returning later to demand another reduction — a caveat that carries weight only if the government holds the line.

Who is alarmed?

The cut compounds existing tensions within Labour ranks over the approved Jackdaw gasfield and reduced green funding diverted to defence. MPs see the pending Rosebank oilfield decision and the EV mandate as critical tests.

Lizzi Collinge, Labour MP for Morecambe and Lunesdale, said: "The upcoming decision on the ZEV mandate will have a huge climate impact, possibly the biggest one that's on the PM's desk. But it will also set the direction for tackling the cost of living and helping get our energy prices down over the coming decade."

Catherine Fookes, MP for Monmouthshire, said: "We need the ZEV mandate to stay, and Rosebank to be rejected."

The charging industry warns the economic stakes extend beyond climate policy. Shane Brennan, chief executive of ChargeUK, said: "Weakening the mandate puts £1.7bn of charging infrastructure at risk and all the associated jobs and supply chain spending that goes with it. Charging investors' confidence will be rocked by a third change in three years."

A government spokesperson said: "The government is united in its commitment to the ZEV mandate and no decisions have been taken. We are committed to the phaseout of all new cars relying solely on petrol and diesel engines by 2030, and to 100% of new car and van sales being zero emission by 2035, and our legally binding net zero targets."

Paul McNamee, director of the Labour Climate and Environment Forum, said any significant weakening "will be seen as a rowing back on climate leadership," and demanded assurances the mandate will not be cut again. Ministers have already diluted the targets several times since the policy was first proposed; the question for investors and MPs alike is whether 60% marks the floor or simply the next step down.