Labour's 2030 ICE ban could impact ZEV mandate plans

In its election manifesto, Labour committed to reinstating the 2030 ban on new ICE (petrol/diesel) car sales, which the previous government had pushed back to 2035. However, reports now suggest that any reinstatement of the 2030 ban would allow the sale of new hybrid cars to continue until 2035.

A ‘tweak’ to the manifesto pledge has been implied by a spokesperson for the Department of Transport, who has said: “This government’s policy has always been to revert to the original 2030 phase-out date for the sale of new vehicles with pure internal combustion engines.

“The original phase-out date included the provision for some hybrid vehicle sales between 2030 and 35. We know it is important to provide certainty and stability for drivers and will set out further details in due course.”

The suggestion of a future for hybrids, potentially those with the capability to drive a significant distance with zero emissions, as stipulated by the Conservatives, has yet to be clarified, but Mann Island Finance MD John Hughes believes such a move could also be embraced as a welcome adjustment to the part of the UK’s Zero Emission Vehicle (ZEV) mandate terms, noting:

“The ZEV mandate is a laudable ambition, but broadening its scope to include longer range hybrid cars, at least for a while, could make the shift to zero-emission driving more affordable and sustainable.

“It would allow extra time for the development of the charging infrastructure and more battery innovation, and it might help to soften the depreciation curves for all used cars that the speed to switch has started to highlight. It may also help to preserve jobs in car and component production, which are under pressure across Europe.”

Under the ZEV, 22% of new car sales and 10% of new van sales must be ZEVs this year, and this percentage will continue to rise. By 2030, 80% of new cars and 70% of new vans sold will need to be zero-emission, increasing to 100% by 2035.

Slowing or tweaking the UK’s ZEV mandate, potentially to include hybrids with a decent minimum range, would be popular with manufacturers struggling to switch from ICE to ZEV sales. The European Automobile Manufacturers’ Association (ACEA) is reportedly poised to urge the European Union (EU) to delay its 2025 electric vehicle (EV) production and emissions targets by two years.

Hughes concludes: “Encouraging so many car buyers to go fully electric or risk potentially punitive fines so quickly is challenging for some OEMs and has seen an acceleration in tactical initiatives to chase sales. While such tactics are not new in new car retailing, as a tool to push such a significant shift in buyer behaviour, it risks creating unwelcome future used car value volatility that could affect sustainability.

“It will be interesting to see what happens, but a pragmatic adjustment to the current ZEV plans could be appropriate.”