From NOT A LOT OF PEOPLE KNOW THAT
By Paul Homewood
Car manufacturers must ensure that electric cars make up at least 33% of their total registrations this year or face swingeing government fines of £12000 for every car they are short.
So far, they are struggling at below 22%, which is even less than at the same stage last year. They finished 2025 at 23.4%, well below the government Zero Emission Vehicle (ZEV) mandated target of 28%. The harsh reality is that few private buyers want one, despite what the government orders.
Manufacturers who fall below target may be able to offset part of their shortfall if the CO2 emissions from non-electric cars are below the baseline set, for instance if they sell a lot of hybrids. But this is a limited option. They can also buy surplus ZEV allowances on the open market or “borrow” against future surpluses.
The Dept of Transport has now published the full overview of ZEV compliance for 2024 registrations, when EV sales reached 19.8% against a target of 22%. Overall, credits from lower emissions have balanced out the 2.2% shortfall.
But as ever, the devil is in the detail, with some manufacturers forced to buy surplus allowances or borrow, while others make a handy profit.
According to the DfT overview, major manufacturers who have had to buy ZEV allowances include:
That’s over 43000 allowances. According to the DfT, the average price was around £4000, making a total bill of around £170 million.
But it does not stop there.
The principal beneficiaries of this car industry destroying madness have been Tesla and the three major Chinese electric carmakers. Together they have been handed a windfall of around £150 million.
This is, however, just the tip of the iceberg.
Auto industry experts say that the market for ZEV allowances was soft in 2024, given the overall availability of allowances. Carmakers with surpluses have been tempted to cash in now, rather than risk holding out for a higher price in future years.
But already it appears that it will be a much tighter market for 2025. If this year carries on as it has started, the demand for allowances will be much higher than the supply; as a consequence, the price for them will rise close to the £12000 fine, with buyers desperate to outbid each other.
It is not a stretch to guess that the bill for allowances/fines could reach a billion next year. It is no wonder many carmakers, such as Stellantis and Hyundai, are warning that ZEV targets will lead to some manufacturers simply pulling out of the UK market. It is estimated by the SMMT that the car industry is already subsidising EVs to the tune of £11000 for every car sold, in an attempt to attract buyers.
In the meantime, the British Government is happy to hand over hundreds of millions to the Chinese car industry.
If you wanted to decimate the country’s motor industry, it is hard to think of a better way to do it!
