In early April, a UK government press release announced changes to the Zero Emissions Vehicle Mandate, which was originally introduced in January 2024. The press release includes confirmation that the phase out date for the sale of new petrol and diesel cars will remain 2030, which was the originally intended target before it was delayed by the previous government to 2035. However, hybrid vehicles and vans with an internal combustion engine can continue to be sold until 2035, and small and micro manufacturers will also be exempt from the 2030 phase out.
Furthermore, the changes introduce greater flexibility to support carmakers, for example through extending the ability to transfer non-ZEVs to ZEVs credits to 2029, allowing van-to-car credit transfer, and extending the ability to borrow in 2024-2026 with repayment enabled through to 2030. The press release emphasises the government’s intention to provide British car brands with ‘certainty, stability and support’ amidst a context of ‘global economic headwinds’, in reference to Donald Trump’s recent announcement of a 25% tariff on all car imports to the USA.
The announcement has been met with mixed reactions from industry in the UK – many have welcomed the increased clarity and flexibility, however there are criticisms over the detrimental environmental impacts of this flexibility, as well as concerns that there is still insufficient action in helping to stimulate consumer demand for electric vehicles. While the UK was ranked as the largest electric vehicle market in Europe in 2024, the automotive industry has warned that the high subsidies they are providing to incentivise electric vehicle sales amidst weak demand are unsustainable.
The 2030 phase out date for new petrol and diesel cars keeps the UK ahead of the EU, where a Regulation on CO2 emissions for new cars and vans will prohibit new sales of CO2-emitting cars and vans from 2035 onwards under a 2023 amendment of the Regulation on CO2 emission performance standards for new passenger cars and new light commercial vehicles. In the years leading up to 2035, EU manufacturers must comply with annual CO2 emissions targets.
Just as in the UK, the date to end the sale of new petrol and diesel cars has caused controversy, with attempts from the European People’s Party (EPP), the largest party in the European Parliament, to reverse the ban – a demand intensified by concerns about US tariffs. The leader of the EPP, Manfred Weber, a German MEP has called for the scrapping of the 2035 ban altogether at a similar time to Conservative Leader of the Opposition, Kemi Badenoch in the UK parliament casting doubt on the ability of the UK to meet its 2050 net zero goal.
Seven EU member states have been attempting to move forward a planned 2026 review of the EU’s Regulation, and review fines for manufacturers failing to comply with emissions standards. The Commission has responded to these concerns in April 2025 with a targeted amendment to the Regulation, which will allow manufacturers to meet 2025-2027 targets over a three-year average instead of on an annual basis, principally to provide producers with greater flexibility and support. However, there are concerns that this change in policy could lead to further acquiescence on the headline 2035 target for a phase out of new CO2-emitting cars and vans.
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