Leading car manufacturers including BMW, Jaguar Land Rover (JLR), Nissan and Toyota have warned that strict electric vehicle (EV) sales rules could damage the British automotive industry, threatening jobs and investment worth hundreds of millions of pounds.
Documents submitted to government consultations reveal that major carmakers lobbied for greater flexibility in the UK’s zero emission vehicle (ZEV) mandate, which requires an increasing proportion of new cars sold each year to be electric.
The mandate, introduced under the previous Conservative government, imposes heavy fines on companies that fail to meet annual targets.
While EV sales in Britain have risen sharply, making up over 20 percent of the market in July, manufacturers argue that consumer demand has been weaker than expected. Many firms have had to cut prices to stimulate sales, a move welcomed by buyers but described by the industry as unsustainable in the long term.
In April, following intensive lobbying, the Labour government eased the rules by introducing new flexibilities, allowing manufacturers to sell more petrol cars than originally planned.
BMW highlighted that post-Brexit challenges had already weakened the UK as a manufacturing hub, adding that Britain’s ZEV rules were tougher than similar regulations in the European Union and California. The German manufacturer, which builds Mini and Rolls-Royce cars in the UK, said the policies risked undermining its 8,000 direct jobs and as many as 50,000 roles across the supply chain.
Toyota, which operates plants in Derbyshire and north Wales, warned that financial penalties could reach hundreds of millions of pounds for individual companies, putting both investment and employment at risk. The company has long championed hybrid technology and successfully lobbied for hybrid sales to continue until 2035 in the UK.
Nissan, which runs its only European car plant in Sunderland, stressed that high compliance costs could divert vital funds away from research and development in British EV production. Meanwhile, Jaguar Land Rover argued that credit trading rules forced UK-based manufacturers to subsidise foreign competitors, particularly Chinese producers dominating the electric car market.
Environmental groups have pushed back strongly, insisting the ZEV mandate is driving the transition to cleaner transport. Campaigners argue that the targets for 2024 were already met, proving the industry is capable of accelerating the shift to electric vehicles.
Advocacy groups say watering down the rules risks delaying decarbonisation and undermining the UK’s climate commitments. They point to falling EV prices as evidence of competition benefiting consumers, and argue that stronger regulations will encourage investment in affordable and sustainable transport.
The Society of Motor Manufacturers and Traders (SMMT) supported the government’s decision to adjust the rules, warning that overly strict targets could have forced decarbonisation at the expense of British industry. The SMMT has called for further consumer incentives to stimulate demand and ensure a smooth transition.
BMW reaffirmed its support for climate goals but said consumer demand, not mandates, would ultimately dictate the pace of change. Nissan welcomed the Labour government’s adjustments, describing them as pragmatic in light of slower-than-expected EV take-up.
Both Jaguar Land Rover and Toyota declined to comment further.
The debate over EV targets highlights the challenge of balancing climate policy with industrial strategy. While the government seeks to reduce emissions, carmakers argue that excessive regulation could undermine Britain’s competitiveness and push investment overseas.
With the automotive sector employing hundreds of thousands of workers and contributing billions to the economy, the outcome of the ZEV mandate reforms will play a decisive role in shaping the future of British manufacturing, investment, and climate commitments.
