'No way' huge driving rule change can continue amid 'supply or demand' fears

The Zero Emissions Vehicle (ZEV) mandate was introduced at the start of the year but leading expert Sean Kelly has warned the new rule will be "scrapped" within months

A leading expert has predicted that a significant driving rule change introduced earlier this year will be "scrapped" within months. Sean Kelly, the owner of Guildford-based Vines Group, has voiced concerns over the UK's Zero Emissions Vehicle (ZEV) mandate, which he believes requires urgent revision to prevent detrimental effects on car manufacturers and dealerships.

The ZEV mandate, effective from January 3, 2024, dictates the proportion of vehicles produced by manufacturers that must be fully electric. Currently, only 22 per cent of new vehicles need to be electric, but by 2030, the requirement will jump to 80 per cent for cars and 70 per cent for vans.

Despite these targets, consumer demand for electric models is diminishing, leaving dealers with excess stock. Speaking to Car Dealer Podcast, Sean stated: "There is no way this can carry on as part of UK Government legislation. I'm putting a marker down here now. Worst case scenario by this time next year it's either changed or scrapped or amended. 100 per cent."

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While Labour has committed to reinstating the 2030 ban on petrol and diesel cars—a policy delayed until 2035 by former Prime Minister Rishi Sunak—it appears they do not plan to alter the ZEV mandate, with the current timeline expected to remain unchanged.

Manufacturers who fall short of stringent ZEV (Zero-Emission Vehicle) targets have the option to purchase credits from other companies as a safeguard against substantial penalties. Despite this, the targets compel manufacturers to continue producing EVs (Electric Vehicles), even when their older models aren't selling well, reports the Express.

Sean has highlighted the financial challenges firms are facing, cautioning that even with a modest target of 22 per cent, companies struggle to stay profitable. Expanding on the issue, Sean remarked: "It's about supply and demand, isn't it? If the demand isn't there and the supply is too high, that affects the price."

"And that's what the ZEV mandate is doing. EVs are more expensive to manufacture for the OEMs in the first place."

"Therefore, they have a higher price point and they are not even passing all of that onto the retail customer in the first place."

"Then, in order to meet an artificially made-up threshold, we are having to discount them so heavily that the dealers aren't making any money, and ultimately, the manufacturers are not making the margins they used to as well."