Labour’s lack of clarity surrounding sales targets for electric vehicles is causing small bespoke car businesses in Britain to come to a ‘standstill’, leading maker Lister has warned.
Whether or not low volume manufacturers are exempt from the ban on sales of new petrol and diesel models from 2030 is yet to be confirmed by Labour.
This leaves a number of small – but iconic – British marques including Morgan and Caterham in limbo not knowing whether increasing electric car sales requirements apply to them or not.
Lawrence Whittaker, CEO of The Lister Motor Company, which dates back to 1954, said small car manufacturers are putting ‘all future plans on hold’, as they cannot make investment decisions if they don’t know whether they will remain exempt.
Speaking in an interview on GB News on Wednesday, Whittaker commented: ‘We’re all completely at a standstill until we know what the Government’s stance is on this.’
This followed a statement put out by Whittaker that said: ‘This year, our 71st in business, we had plans to create a brand-new car for the road, our first new model in over 32 years.
‘As it stands, with no clarity on the future rules for IVA or SVA Type Approval cars, we have taken the incredibly difficult and heart-breaking decision to put all future plans on hold.’
Whether small-volume car manufacturers are exempt from the Zero Emission Vehicle (ZEV) mandate has yet to be confirmed, leaving companies like Lister at a ‘standstill’
The Zero Emission Vehicle (ZEV) mandate was made law last January by the Tory Party to create a binding pathway to cutting out new fossil fuel cars over the next decade.
It requires car brands to sell a specific minimum percentage of EVs each year. In 2024 it was 22 per cent and This year the threshold increased to 28 per cent.
It will continue rising each year until it reaches 80 per cent in 2030 – with some hybrids exempt – and eventually 100 per cent zero emission car sales by 2035.
The fine for missing the annual quotas is a punishing £15,000 per EV short of the target.
It had originally been suggested that car makers producing fewer than 1,000 units per year would be exempt from the rules, but this has yet to be rubberstamped.
In a statement earlier this week, Whittaker posted: ‘In the past, small-volume British car manufacturers such as ourselves, Morgan, Caterham, Ginetta, etc, have been exempt from emission demands because we produce less than 1,000 cars per annum under the IVA or SVA Type Approval.
‘However, so far, the UK Government has yet to state if this exemption will continue.’
Small-volume car businesses are already exempt from other rules enforced on mainstream brands, such as crash testing due to cost constraints.
Whittaker explained to GB News that boutique makers can’t adapt to new regulations in the same way large manufacturers can – or afford to make a lineup with a variety of fuel types.
‘Unlike the big manufacturers, they can afford to do some electric, some hybrid, some petrol and diesel cars – we just cannot afford that,’ he said.
The ZEV mandate forces car makers to sell an increasing volume of EVs between now and 2035 – this year it’s 28%
Lawrence Whittaker, CEO of The Lister Motor Company, has said that small manufacturers are in ‘stalemate’ until the Government gives clarity on the ZEV position
Without clear guidance on future regulations, small manufacturers like Lister can’t develop new models.
‘If we’re going to invest £5million in the next new model, which obviously we want to do, and whether that’s electric or whether it’s petrol, obviously we just need to know what we can do,’ Whittaker told GB News.
Saying small manufacturers are in ‘stalemate’ Lister asked for ‘an urgent update to the legislation.’
The Government’s consultation into the ZEV mandate and any flexibilities was opened late last year and remains in session.
Ministers say it was ‘determined to support automotive companies as they revamp their production lines, adjust their business plans, and develop the technology needed for the next generation of zero emission vehicles’.
What is the Zero Emission Vehicle (ZEV) Mandate?
Passed into law under Rishi Sunak’s Conservative government, the zero-emission vehicle (ZEV) mandate requires manufacturers to increase the share of zero-emission cars they sell each year.
Given there are almost no hydrogen fuel cell vehicles sold in Britain today, this primarily means an increase in battery electric car sales.
The mandate works on a credit-based system where manufacturers are awarded or stripped of credits if they overperform or underperform on the annual quotas.
Manufacturers can choose to bank these credits for future years if they’re needed or can be sold to underperforming car makers who need them to avoid fines.
Conglomerates, like Volkswagen Group and Stellantis, can use credits from one brand under its umbrella to help another worse-performing brand it owns.
But manufacturers also earn credits for selling low-emission cars, such as plug-in hybrids.
The ZEV mandate forces car makers to sell an increasing volume of EVs between now and 2035
If a car maker beats their CO2 target (which is set individually for each brand) by reducing their CO2 emissions, then they can, for the first three years, convert this breathing room into ZEV credits at an exchange rate.
However, failure to meet annual percentage sales targets with credits each year will result in £15,000 per-vehicle financial penalties.
The targets for ZEV car sales are:
- 2024: 22% (10% for vans)
- 2025: 28% (16% for vans)
- 2026: 33% (24% for vans)
- 2027: 38% (34% for vans)
- 2028: 52% (46% for vans)
- 2029: 66% (58% for vans)
- 2030 – new petrols and diesel banned: 80% (70% for vans)
- 2035 – all new hybrids also banned: 100%
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