As the automotive industry awaits the government’s consultation on the end of sale date for petrol and diesel cars and potential changes to the zero-emission vehicle (ZEV) mandate, the Society of Motor Manufacturers and Traders (SMMT) reflects on a challenging 2024. The year has seen the UK and global automotive sectors navigate significant headwinds in their efforts to decarbonise.
Substantial investment has already been made in developing electric vehicles (EVs), with a wide range of car and van models now available. However, further substantial investment has been required in 2024 to subsidise sales to meet the UK’s ZEV mandate. Mike Hawes argues that the industry cannot continue to single-handedly support this transition against a backdrop of subdued demand, leading to unsustainable EV discounting. SMMT believe that consumer incentives, accessible charging infrastructure, and a review of the mandate itself are necessary for successful decarbonisation and economic growth. The promised mandate review is urgently required to provide the clarity and support the sector needs.
The transition to self-driving vehicles is also a key focus. The 2024 Automated Vehicles (AV) Act is considered an important step for innovation, placing the UK among leading markets with regulatory frameworks for safe and responsible rollout. Mike goes on to highlight the potential benefits of self-driving vehicles, including significant improvements in road safety and a substantial economic boost by 2040. To maintain progress, the development and introduction of secondary legislation is essential.
The heavy commercial vehicle sector has also seen significant developments in 2024, with the UK holding leading market positions for zero-emission buses and trucks in Europe. With new HGVs under 26 tonnes likely required to be zero-emission by 2035, SMMT stresses the need for a modernised Plug-in Truck Grant, dedicated HGV infrastructure, and a long-term strategy for bus decarbonisation to avoid similar challenges to those currently faced by the car and van markets.
UK manufacturing figures reflect the ongoing transition, with investment from 2023 beginning to materialise as factories retool for EV production and battery capacity scales up. This transition has resulted in a temporary dip in production volumes, as shown in SMMT’s November manufacturing figures, with year-to-date volumes down -12.9% compared to 2023 and significantly lower than 2019 levels.
With global competition for automotive investment, SMMT urges the UK to actively pursue opportunities to secure its manufacturing base and supply chains. The government’s Invest 2035 strategy and a comprehensive trade strategy are considered crucial for achieving this. The SMMT believes the automotive sector can drive significant green growth in the next decade, but collaboration between industry and government is essential to achieve this.
