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Nissan plans to warn ministers that the UK car industry has reached ‘crisis point’, with jobs and competitiveness at risk unless the government eases electric vehicle rules, according to two people familiar with internal discussions.
EV consisting of 18% of new car sales In England, it is below the 22% required under the government’s quota system for the first 10 months of the year.
Manufacturers can bridge the gap by purchasing credits from electric vehicle manufacturers like Tesla. But the minimum EV level is set to rise to 28% next year, which car manufacturers warn is too high to link credit at a time of falling consumer demand and could lead to fines of up to £15,000 per vehicle.
A Nissan representative said, “In reality, customers are not moving at the same pace as we had hoped.” “If we fail to do something about this in the coming months, it will impact the industry to a degree that puts jobs and economic growth at risk.”
The comments come ahead of a meeting on Wednesday between Transport Secretary Louise Haigh and the car and charging industry to discuss the UK’s transition to EVs.
If discussions fail to yield concrete results, Nissan plans to escalate the issue by appealing to Sir Keir Starmer, highlighting growing tensions between the industry and the transport department.
Other automakers have privately complained that they are unable to meet one-on-one with transportation authorities. One person said the Department for Transport had been “indifferent” to the issue and industry concerns had been rejected by ministers and civil servants.
The Department for Transport (DfT) said the government had been working closely with Nissan and had met with the company twice in the past two weeks to discuss zero-emission vehicle obligations.
“Manufacturers already have flexibility in place and we continue to support the transition to electric vehicles,” a spokesperson said. “We have also announced more than £300m in the Budget to support the transition, and a further £2bn to support car manufacturing in the UK.”
Nissan is one of the UK’s largest car companies, employing more than 6,000 people at its Sunderland plant. The Sunderland plant will support an additional 30,000 jobs across the supply chain and represents a £6 billion investment by the company.
But the manufacturer has come under heavy pressure globally due to slowing EV sales growth, an outdated product lineup and falling demand from China, prompting emergency turnaround measures to cut 9,000 jobs.
A person close to Nissan said the company was “petrified” by Chinese competition. This will make it difficult for the Japanese group to fight back if higher emissions targets are imposed in the UK and EU.
The UK’s Zero Emission Vehicles (ZEV) Directive requires all new cars sold to be fully electric by 2035. However, during the Budget, Prime Minister Rachel Reeves confirmed the government’s intention to bring forward the ban on the sale of new diesel and petrol cars to 2030. However, a small number of hybrid sales will be permitted until 2035.
Slowing EV sales growth in other European markets has sparked debate over whether to waive fines for car manufacturers if they fail to comply with EU emissions rules.
The UK market fared better in October, with new EV sales up 25% year-on-year, accounting for almost 21% of total car sales.
But industry officials say retail demand remains weak and annual targets will become much more difficult to meet from next year when the 28% rule comes into effect.
But automakers are divided over how the government should relax its targets, with some calling for an end to ZEV mandates, while others favor fewer fines and more subsidies to boost consumer demand.
Environmental groups say the EV targets should be maintained because automakers can still meet them by purchasing credits. The company is also credited with significantly reducing its overall carbon emissions.
