Last week, Nissan called for urgent action to address the risks posed to the UK automotive industry by outdated targets in the UK’s Zero Emissions Vehicles (ZEV) Mandate. The ZEV Mandate was introduced to incentivize the transition from petrol and diesel vehicles to electric vehicles (EVs), with the assumption that consumer demand for EVs would continue to rise sharply.
However, recent market trends show a slowdown in consumer demand, putting pressure on automotive manufacturers to meet the targets set by the mandate. Despite efforts by manufacturers to discount EVs and stimulate sales, the Society of Motor Manufacturers and Traders (SMMT) predicts that only 18.5% of the total car market will be made up of EVs in 2024, falling short of the mandated 22% target.
If manufacturers fail to meet the ZEV Mandate’s targets, they could face significant fines unless they purchase credits from EV-only brands. However, none of these brands are manufactured in the UK, meaning that UK manufacturers would effectively be subsidizing foreign EV sectors, to the detriment of investment in domestic manufacturing. Nissan has expressed concerns that this would undermine the financial viability of the UK automotive industry, especially given its substantial investments in electric vehicle production and technology development in the country. As part of its commitment to a fully electric future, Nissan is investing billions in new EV models and technologies for its UK operations.
Nissan has urged the UK government to make immediate adjustments to the ZEV Mandate to safeguard these investments and protect the UK’s automotive sector. The company has proposed increasing flexibility in the mandate, such as allowing manufacturers to borrow credits from future years in the short term. Additionally, Nissan suggests implementing a two-year monitoring period for 2024 and 2025 to prevent devastating fines, allowing the industry to adjust and better align with the long-term target of 80% of vehicles having zero emissions by 2030. These changes, according to Nissan, would provide manufacturers with the stability needed to navigate current market challenges and continue their progress toward a fully electric future.
Guillaume Cartier, the chairperson for Nissan’s Africa, Middle East, India, Europe, and Oceania region, emphasized that Nissan has long supported the UK’s ZEV Mandate and has been actively working toward a fully electric future since the launch of the Nissan LEAF in 2010. However, he warned that the current structure of the ZEV Mandate could jeopardize the business case for manufacturing cars in the UK and threaten the future of thousands of jobs and billions of pounds in investments. Cartier called on the government to act before the end of the year to prevent an irreversible impact on the UK automotive sector.
Nissan is one of the largest employers in the UK automotive sector, with over 7,000 employees in the country and significant contributions to the UK economy. The company operates its manufacturing plant in Sunderland, which is the largest car plant in the UK, and its design and research teams are based in Paddington and Cranfield. As part of its EV36Zero blueprint, Nissan has announced plans to produce three new EV models in the UK, powered by renewable energy.
The company is also investing in battery recycling, skills development, and vehicle-to-grid technology as part of its vision for a sustainable, fully electric future. While Nissan acknowledges that further work is needed on consumer incentives and charging infrastructure, the proposed adjustments to the ZEV Mandate would not incur additional costs to taxpayers and would help prevent valuable investments from being diverted toward fines for overseas manufacturers.