UK Relaxes Electric Car Rules Amid US Tariffs
The UK government has announced changes to its electric vehicle (EV) sales targets to support the car industry in the face of trade tariffs imposed by the US. While the ban on selling new petrol and diesel cars remains in effect from 2030, manufacturers will now have more flexibility in meeting their annual targets and face reduced fines.
Transport Secretary Heidi Alexander told BBC Breakfast that these changes were not a ‘silver bullet’ but part of the solution to responding to the US tariffs. The UK opposition parties have expressed concerns that Labour’s measures may not be sufficient to boost the car industry.
US President Donald Trump imposed a 25% levy on cars imported to the US, a significant export market for the UK motor industry. This came into effect last week, in addition to a 10% tax on nearly all UK products announced by Trump.
Currently, 28% of new cars sold in the UK must be electric, a target that will rise annually until 2030. Manufacturers will now have more freedom in how they meet their yearly targets, allowing them to make up for shortfalls in one year by selling more EVs the next.
The fine for not meeting the latest emissions standards will be reduced from £15,000 to £12,000 per vehicle. Additionally, a ban on the sale of hybrid vehicles will come into effect from 2035.
Smaller British firms like Aston Martin and McLaren will be allowed to continue selling petrol cars beyond the 2030 deadline. Prime Minister Sir Keir Starmer announced that the government is investing £2.3 billion in the car industry, including tax breaks for EV buyers and improving charging infrastructure.
Industry leaders have welcomed the changes, with Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders, describing them as ‘very much needed.’ However, some critics argue that the measures do not go far enough to address the industry’s challenges.
The US is the second-largest export market for the UK’s car industry after the European Union. Jaguar Land Rover has announced that it will pause all shipments to the US in April due to the new trading terms.
