In 2025, the calls from UK car manufacturers for renewed government incentives for electric vehicles have reached fever pitch. Nearly every high-profile executive from legacy firms has gone public about the urgent need for official support to boost EV demand. While the government’s Zero Emission Vehicle (ZEV) Mandate was designed to speed up the transition, carmakers say that market appetite simply isn’t keeping pace with the regulations.
The ZEV Mandate—which became law in January 2024—requires that manufacturers sell a rising percentage of new zero-emission vehicles. For 2024, at least 22% of cars and 10% of vans must be electric or hydrogen-powered, and that target will jump rapidly until only zero-emission vehicles can be sold by 2035. Failing to hit these targets lands hefty fines, up to £15,000 per car under target. There’s also a system for trading compliance certificates between manufacturers, but this only cushions the blow for so long.
After 18 months, the pressure is showing. Some flexibility was built in this year, and the government relaxed a few rules in April 2025 to give the auto industry more breathing room. Still, the phase-out of new petrol and diesel cars by 2030 is marching closer. More importantly, car brands say the targets are getting out of sync with “true” consumer demand for EVs—and that could hurt investment and stability in the market.
The reality on the ground is stark: as of June 2024, just 3% of cars on UK roads were electric, and 8% were hybrids. Only 19% of new car registrations at that time were battery electric, a big jump from five years ago but still not enough to meet the growing ZEV requirements. The upfront cost of EVs, slow rollout of public charging, and ongoing consumer scepticism are all putting a lid on demand.
Executives are nearly unanimous: unless incentives return, the risk is that manufacturers will either pay large fines, be forced to discount EVs at a loss, or both. There’s been frustration that EV grants for consumers and tax breaks for company cars have fallen away just as targets get tougher. The current patchwork of grants for charging infrastructure and some workplace support, while welcome, doesn’t directly help shift EVs into mainstream buyers’ driveways.
The government’s long-term goal is clear—hit 100% zero-emission sales for cars and vans by 2035 and lead the world in transport decarbonisation. But with the market still described as “small yet growing” and most consumers hesitant to take the plunge without more help, the industry’s message is united: incentives work, and they’re needed more than ever as the ZEV Mandate puts the squeeze on. Whether ministers will listen in time to prevent a slowdown in the UK’s electric transformation remains the big question for the rest of 2025.
