The UK government has confirmed a significant softening of its Zero Emission Vehicle (ZEV) Mandate in a move set to relieve pressure on UK manufacturers. The announcement has offered greater clarity around the 2030 new car sales deadline, providing welcome breathing space for niche marques as well as reduced fines for larger manufacturers who fail to hit the CO2 reduction targets.
Following a two-month consultation, the government has confirmed that the 2030 ban on new petrol and diesel cars will remain. There is now however more clarity around the definition of hybrid vehicles, which will be given a stay of execution until 2035. This includes full-hybrids like the Toyota Prius, plug-ins such as the Bentley Bentayga Hybrid, although mild hybrids will still potentially be killed by the mandate.
Crucially for Britain’s specialist car industry, the updated mandate introduces tailored exemptions for small- and micro-volume manufacturers, such as Aston Martin, Morgan, McLaren, Lotus and Caterham. Manufacturers registering fewer than 1000 cars annually (MVMs) are fully exempt from the 2030-2035 hybrid rules, while small-volume marques (SVMs, producing between 1000 and 2499 vehicles per year) will only be required to meet nominal, individually agreed CO2 reduction targets after 2030.
This adjustment ensures that brands producing highly specialised low-volume vehicles can continue to manufacture combustion-engined cars beyond 2030, avoiding the huge costs of prematurely switching to battery-electric platforms.
For the mainstream manufacturers, the government is also easing penalties for missing the ZEV targets. Fines will drop from £15,000 to £12,000 per non-compliant car, and from £18,000 to £15,000 per van. Additional flexibilities include extending non-ZEV to ZEV credit transfers and future borrowing allowances to 2029, helping larger brands like JLR and Nissan manage their electrification timelines more smoothly.
The adjustments reflect growing political and economic pressure – exacerbated by recent global trade uncertainties and pushback from manufacturers – which aims to support the UK’s diverse automotive landscape. Expect further updates and clarifications in the coming months.
