Road to 2030: Understanding the legislation behind the 2030 ban

What’s more, with the cost-saving benefits washed away, it’s not inconceivable that punitive taxes could be an option in order to force EV uptake. France’s Malus tax, for example, hits the purchase of vehicles that emit 133g/km of CO2 or more, up to the tune of about £33,000 for the biggest polluters. Would you still lust after a hot hatch if 20% was added to its price as an environmental surcharge?

What incentives are likely?

The PiCG was introduced in 2011, offering EV buyers an incentive of up to £5000 to switch to a zero-emissions vehicle. It has come down in steps and last year was reduced to £3000 or 35% of the vehicle’s sticker price, whichever is lower – a level that has been guaranteed until the 2022/23 financial year begins. There’s no grant available for buying a plug-in hybrid any more.

The likelihood is that the cash-strapped government will reduce these grants over time and use more punitive measures to encourage uptake, although the industry remains hopeful that a more positive stimulus package will be possible.

What incentives would the industry prefer?

SMMT boss Mike Hawes has been pushing for a more generous incentive to the PiCG to be put in place following the 2030 announcement, reasoning that even the current levels of exponential growth will not be enough to give EVs a 10% market share of new car sales until around 2022.

“It’s a speedy transition, and something like the removal of VAT on electric vehicles would accelerate uptake and send a clear message to consumers,” said Hawes.

Coupling the removal of VAT with the PiCG would put the UK’s EV incentive on a par with the most generous on offer in Europe, which are currently led by France and Germany.

What incentives would consumers prefer?

Polling of What Car?’s car-buying audience has consistently highlighted that people are more likely to be swayed to buy low-emissions vehicles not for their environmental savings but for their financial ones – be it lower road tax, free congestion charge or lower running costs. The power of a financial incentive should not be lost, therefore.

The ideal scenario for driving change would be for any incentive not just to bridge the gap in cost between a combustion-engined car and an EV, but to put the latter at an advantage, especially in these early years where there is a perceived – and for some real – difference in the capability and practicality of an EV versus an ICE car.

Is there any governmental perception of the risk in forcing particular technologies on the motor industry, rather than setting targets and letting engineers achieve them?

If there is, it’s pushed far to the fringes of policy, with electrification now the only goal. What’s more, with the environmental lobby’s voice being heard loudly, any efforts to sway that agenda are being swiftly and robustly kicked aside as being driven by legacy car makers lobbying to delay change as they struggle to adapt their business models to the new reality.

It’s a fact that, today, environmental leadership is a standard whereby all developed world leaders are being judged, and any wavering or altering of the course will require a significant shift in scientific position. True, diesel went from favoured fuel to demonised one in short order (ironically, arguably against the scientific evidence highlighting its benefits in some circumstances), and a decade is a long time in politics, but it seems unlikely.

Do those at the heart of government see the need for a minister responsible for all of this?

It’s hard to ascertain what’s understood; this is a government that has famously and repeatedly struggled to express an understanding of the difference between a plug-in hybrid and an EV, after all, even with Grant Shapps, transport secretary since 2019, famously espousing his love of his Tesla Model 3 regularly.

However, there’s no doubt that pressure is being brought to bear for such a role to be created, and there’s an undercurrent of belief that it could happen once there’s a better understanding of the practical challenges of delivering against the 2030 headline.

Is there any remaining perception in government of the benefit the car industry has brought and can bring to UK jobs and the economy?

The most senior figures in the car industry say so, with even the archest cynics having applauded the dialogue of recent months. To have them on board publicly and privately is telling, given both the imposition of the 2030 deadline and the value placed on fishing over automotive in Brexit negotiations, despite their relative financial values to the country (£446 million versus £49 billion, according to ONS).

But that respectful stance only goes so far. What the car industry lacks at present is a champion in government. Greg Clark, business secretary until mid-2019, was an ardent and prominent supporter of it, but he was undone by his Brexit stance. Alok Sharma in comparison appears to go through the motions, although it’s also fair to say that he has had plenty more to deal with over the past 12 months. Now, however, is the time to step up.

Having done so much recently to bash the automotive industry, is there any feeling in government that the industry now needs a level road to success?

Given the dramatic change that’s required to make 2030 a reality, it’s far more likely that there will be constantly changing goalposts than any kind of stability, beyond the one certainty of now having fixed end dates for the sale of new ICE cars.