ZEV Mandate review must deliver change

The UK automotive, fleet and rental sectors have called for the Government’s review of the Zero Emission Vehicle (ZEV) Mandate to deliver a more realistic and commercially sustainable pathway to electrification, as ministers consider potentially significant changes to EV sales targets.

The Government launched its consultation on the ZEV Mandate on 14 August, bringing forward a review originally expected in 2027 as it seeks to balance the UK’s decarbonisation ambitions with the pressures facing manufacturers, fleets and consumers.

The consultation, which runs until 23 October, asks vehicle manufacturers, suppliers, charge point operators, dealers, consumers and other stakeholders for views on the pathway towards ending sales of new petrol and diesel cars in 2030 and ensuring all new cars and vans are zero emission by 2035.

While the Government has stressed that the 2030 and 2035 end goals remain unchanged, the review could result in substantial changes to the annual ZEV sales trajectory.

Under the current mandate, manufacturers are required to achieve a 33% zero-emission share of new car sales and 24% for vans in 2026, rising to 80% and 70% respectively by 2030. The consultation is considering alternative trajectories that could see the 2030 car target reduced to 70%, 60% or 50%, while the van target could potentially fall to 60%, 50% or 40%. Another option would retain the existing targets but provide manufacturers with additional compliance flexibility.

The Government said the review reflects challenging global economic conditions, including supply chain disruption, tariff and trade uncertainty, as well as slower-than-anticipated demand for zero-emission vehicles in some parts of the market.

It comes despite continued growth in EV registrations. More than one in four new cars sold in the UK is now electric, while July EV sales were 45% higher than a year earlier and more than two million electric vehicles are now registered on UK roads.

Transport Secretary Heidi Alexander said the Government remained committed to the transition but needed to ensure its targets were practical and supported British industry.

“The end goal hasn’t changed – but we need to take business with us on the journey,” she said.

SMMT: Review must deliver ‘meaningful change’

The Society of Motor Manufacturers and Traders (SMMT) has strongly welcomed the early review but warned that marginal adjustments to the existing framework would not be sufficient.

The SMMT said many of the assumptions on which the mandate was originally based had failed to materialise, pointing to high industrial energy costs, expensive and inconsistent public charging and continued pressure from raw material and battery costs.

Although EV demand has accelerated, the trade body argued that this has required billions of pounds of manufacturer and Government discounts and is not sustainable over the longer term.

It warned that an unrealistic trajectory risks damaging profitability and competitiveness, undermining residual values and ultimately reducing model choice and investment in UK vehicle manufacturing.

The industry remained committed to zero-emission mobility, he said, but manufacturers needed conditions that enabled them to continue investing, protect skilled employment and strengthen Britain’s manufacturing base.

The SMMT has also urged the Government to complete the consultation quickly, so manufacturers have greater clarity over the regulatory environment for 2027 and beyond.

BVRLA: Policy must reflect market reality

The British Vehicle Rental and Leasing Association (BVRLA) has similarly welcomed the review, arguing that policy must recognise that different parts of the EV market are progressing at very different speeds.

BVRLA members have registered around 1.3 million battery electric cars, remarketed an estimated 550,000 EVs into the used market and currently have around 750,000 electric vehicles on their balance sheets – representing more than £36 billion of investment.

However, Poston highlighted continuing challenges including residual value volatility, uneven consumer demand, infrastructure constraints and rising compliance costs.

He said: “Success should not be judged solely against annual registration targets, but also by the strength of the wider market, including healthy consumer demand, a sustainable used EV sector and the confidence for businesses to continue investing.”

The BVRLA also wants the review to recognise the substantial differences between the car and van transitions, arguing that their respective use cases, progress and feasibility mean they cannot simply be treated as the same journey on different timelines.

The association will gather evidence from rental, leasing and fleet members before making its formal submission to the consultation.

Europcar calls for ‘whole ecosystem’ approach

Europcar Mobility Group has also welcomed the decision to bring the review forward, saying fleets must be considered alongside vehicle manufacturers when the Government determines the future shape of the mandate.

“Fleets are central to the UK’s decarbonisation ambitions, and getting this policy right matters enormously – not just for mobility providers like us, but for the businesses and private motorists who rely on the rental sector,” he said.

Europcar’s latest EV Barometer found that cost remains a barrier for 40% of respondents, while concerns around charging infrastructure increased to 31.6% during the second quarter.

Morgan said the mandate review therefore needed to consider the “whole EV ecosystem”, with vehicle targets accompanied by faster charging infrastructure deployment, improved affordability and measures to strengthen consumer confidence in both new and used EVs.

“A practical, coordinated approach will enable fleet operators to invest with greater confidence while ensuring that the transition remains accessible and workable for customers,” he added.

Europcar said it would submit a formal response to the consultation and would continue investing in its EV fleet and supporting infrastructure.

Balancing ambition with market conditions

The review comes at a pivotal point for the UK’s transition to electric vehicles. While BEV registrations continue to increase, the pace of adoption varies significantly between private buyers, company cars, rental fleets and the van market.

The Government now faces the challenge of maintaining sufficient regulatory certainty to encourage long-term investment while ensuring annual targets do not move too far ahead of consumer demand, vehicle affordability and charging infrastructure.

For manufacturers and finance and leasing providers in particular, the outcome will have implications beyond new vehicle registrations. The pace at which EVs enter the market will influence residual values, used vehicle supply, fleet replacement cycles and ultimately the economics of financing electric vehicles.

With the 2035 destination remaining unchanged, the debate is increasingly focused on the route taken to get there – and whether adjusting the trajectory now can create a more sustainable transition without undermining momentum towards zero-emission motoring.

The Government consultation closes on 23 October 2026.