Car manufactures have hit the Government’s Zero Emission Vehicle (ZEV) mandate targets for 2024, despite predictions they wouldn’t, according to new unofficial data.
The ZEV targets mean car brands have to sell a percentage of battery electric vehicles (BEVs) each year.
In 2024 – the first year it was made law – that was 22 per cent, but this is rising each year until it reaches 100 per cent in 2035.
The fine for missing the quota – which all manufacturers have managed to escape – is a punishing £15,000 per model below the required threshold.
But new data from Transport & Environment based on 2024 car sales figures from Dataforce suggests all car manufacturers successfully complied with the targets, escaping potential fines.
As well as no car maker needing to pay penalties, only one, Suzuki, will even need to purchase compliance credits.
And while the Government is yet to officially announce that the industry as a whole has met the ZEV target of 22 per cent for 2024 due to the allowed flexibilities, some manufacturers such as Stellantis and Ford have already announced their own results.
The Government’s announcement is expected later this year.
All car manufactures have in fact hit the Government’s Zero Emission Vehicle (ZEV) mandate targets for 2024 we can reveal
While the automotive industry claimed potential fines would cause chaos in the end while the BEV market only hit 19.6 per cent in 2024, below the 22 per cent headline target, this was enough to exceed the 18 per cent required for compliance when flexibilities in the law are considered.
Hyundai, Stellantis, BMW, Mercedes-Benz, SAIC, and Geely (Volvo, Lotus, Polestar) complied by both increasing EV sales and reducing the average emissions of the combustion engines they sold, the analysis finds.
On the other hand Volkswagen, Renault-Nissan-Mitsubishi, Toyota, Ford, Jaguar Land Rover (Tata Motors), Honda, Mazda, and Suzuki will need to supplement EV sales and emissions reductions by either borrowing credits from future years or purchasing them from overcompliant manufacturers.
T&E says that, because the flexibilities are enough to ensure future compliance, the ZEV targets don’t need to be weakened despite calls to do so.
Anna Krajinska, Director of T&E UK, said: ‘Carmakers are meeting the ZEV mandate despite all the complaints. The result is a growing UK EV market and lots of cheaper models for consumers to go electric.
‘The Government must stand firm against calls to water down the law and instead focus on delivering a robust industrial strategy for the automotive sector.’
The ZEV mandate forces car makers to sell an increasing volume of EVs between now and 2035
In December the Government launched a consultation on the ZEV mandate which includes questions on flexibilities – flexibilities that would weaken the stringent levels set.
Manufacturers including Stellantis which owns Vauxhall met with the Government to push for more flexibilities despite not receiving fines in the end.
T&E believes that the tough levels are crucial in order to increase EV ambition, especially as manufacturers are looking to introduce over a dozen cheap EV models below £23,000.
T&E is concerned that these models risk being prioritised for other markets if the mandate is weakened.
Krajinska commented: ‘Backtracking now on the ZEV mandate will endanger the £23billion in EV investments that has been committed to the UK.’
However, while the industry might be breathing a sigh of relief for escaping fines this year, they did deplot tactics to get there….
What tactics were used to hit ZEV mandate targets?
Guy Pigounakis, commercial director of MG UK, told us ‘horrific fines’ for not hitting EV sales targets are responsible for ‘behaviour from manufacturers not seen in 40 years’
Many manufacturers were accused of utilising tactics to ensure they hit EV sales targets last year. Speaking to industry insiders we revealed what some of them were:
1. Slashing prices
The easiest of all tactics is to make EVs more affordable. Lexus was one brand doing just that.
The Japanese luxury car brand slashed some of its prices by more than £7,000; the UX300e saw prices drop by £6,700, with higher specs falling by as much as £7,100.
This was despite Lexus’ EV share sitting at around 30 per cent – well ahead of the mandate’s requirement for 2024.
Fiat was another example: In June 2024, it confirmed it will not only extend its £3,000 ‘E-Grant’ for all EVs, it has knocked a further £3,200 from the list prices of its 500e and 500e Convertible.
2. Motability
The Motability Scheme is a programme that allows disabled people to lease a new car, wheelchair-accessible vehicle, scooter, or powered wheelchair.
‘In terms of where the opportunities lie and where people are exploiting the market, Motability is a huge, huge market. And it’s growing massively’, Guy Pigounakis, commercial director of MG UK told This is Money.
Sales increased 83 per cent year on year.
Motability responds well to aggressive positioning because customers typically want the best financial deal they can get, Guy said: ‘Every manufacturer is aggressively positioning their cars with very low advance payments to try and get people to choose an EV over petrol or diesel.
‘You’re seeing manufacturers offering huge discounts’.
And the market is new to electric car usage, which offers a ‘relatively new, untouched electric market’, which Guy calculates accounts for a ‘very significant 18 to 20 per cent of the total opportunity’.
Fiat confirmed it would extend its £3,000 ‘E-Grant’ for all EVs,as well as knock £3,200 from the list prices of its 500e and 500e Convertible to drive up EV sales
3. Dealership demonstrators
Demonstrator cars are used by dealerships for test drives and as display models in the showroom.
These demo models were and are being used as another method to artificially notch-up EV registrations.
According to Guy, this translates to a ‘significant 44 per cent year-on-year growth of demonstrators [across the network of all brands],’ all of which count towards registrations.
Often dealers are told they need to achieve a certain volume of EV sales to unlock bonuses, leading dealers to put on vehicles as demonstrators.
‘There’s a lot of pressure on dealers from some manufacturers to sell a specific mix of cars, and of course that mix of cars is designed to get the total sales of that manufacturer as close to, or in excess of, 22 per cent as they possible can in line with the ZEV mandate’.
4. Withholding deliveries of new petrol and diesel models
Vertu Motors boss Robert Forrester said manufacturers were withholding delivery of petrol and diesel cars until January to meet 2024 EV sales targets
In December we reported that car makers were holding back Christmas deliveries of new petrol and diesel models until January in order to meet binding electric vehicle sales targets and avoid hefty fines.
Robert Forrester, chief executive of Vertu Motors, said dealers are being forced to delay customers from taking delivery of their new cars, which are being held in ‘compounds’ until January.
Calling it ‘rationing by the back door’ Forrester, who oversees 202 dealers representing major brands including Honda, BMW and Kia across the country, told Auto Express: ‘We have petrol cars in compounds which have been sold to customers, but the keys cannot be handed over because manufacturers, understandably, want to avoid fines at the end of this year. ‘
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