The UK government has announced a fresh set of measures to assist the speed-up of the UK transition to zero-emission vehicles (ZEVs) and is restating its commitment to ending new petrol and diesel vehicle sales by 2030. The updates are part of a wider Plan for Change—an economic growth plan to put the UK at the forefront of advanced manufacturers of automotive, renewable, and clean technologies.

Key Policy Updates and Support Measures:

• Confirmed 2030 Phase-Out: Confirmed 2030 Phase-Out: Government confirmed that they will phase out sales of new petrol and diesel vehicles by 2030, allowing hybrid sales until 2035. understand that this encompasses hydrogen combustion as well. This gives manufacturers and consumers visibility and a staged pathway to transition.
  
• Increased Flexibility for Manufacturers:
  
  • Manufacturers can borrow credits until 2030 and transfer non-ZEV sales into ZEV credits until 2029.
    
  • New credit exchange scheme sees manufacturers being able to trade off quotas from cars against vans, giving manufacturers more flexibility to balance supply and demand across the two vehicle categories.
    
  • Hybrid vehicles will have recognition for CO₂ reductions and will help ease the transition for the many consumers who need time to transition to EVs.
    
• Support for Smaller Manufacturers: Small- and micro-volume manufacturers, including iconic British brands like McLaren and Aston Martin, will not be subject to the 2030 phaseout to ensure the UK’s luxury and performance are recognized.
  
• Expansion of EV Infrastructure:
  
  • Investing more than £2.3 billion of Government taxpayer money into zero-emission vehicle production and encouraging the EV charging infrastructure.
    
  • There is a new public EV charge point being installed every 29 minutes across the UK.
    

• Demand Growth and Consumer Benefits:
  
  • Demand for EVs continues to grow; sales in March 2025 were well above 40% higher than the previous year’s sales. 
  • Half of all used EVs are now being offered for less than £20,000, along with 29 brand new models being sold for less than £30,000. 
  • EV owners can save as much as £1,100 per year compared to petrol vehicle users, not least by charging overnight at home. 
    
• Tax Incentives and Private Investment:
  
  • The tax breaks providing hundreds of millions of pounds worth of support in the EV consumer marketplace continue to be offered. 
  • Private investment into the UK’s clean energy and EV infrastructure, with the investment exceeding £34.8 billion since July 2024. 
  • The Government expects there to be over £6 billion or more in private investment only in the UK chargepoint rollout by 2030.
    

Strategic Importance for the UK Economy:

Over 152,000 people are employed in the UK automotive sector and it contributes £19 billion to the UK economy. These reforms will help protect jobs, attract further long-term investment, and help UK-made cars stay competitive abroad.

Government leaders, including Prime Minister Keir Starmer, Transport Secretary Heidi Alexander, and Energy Secretary Ed Miliband, have stated that such reforms will help us meet not just the UK’s net-zero ambitions but also safeguard and create good jobs in new industries.

Later this spring, the Government will be publishing an Industrial Strategy that will set out further support measures on a sector by sector basis in a range of areas – including clean energy, advanced manufacturing, and innovative technologies – and build upon the UK’s standing as one of the world’s leading nations for sustainable industrial growth.

Outlook:

The UK has the largest EV market in Europe and the third largest in the world: a strengthened UK strategy demonstrates confidence in one ambition – to lead the global automotive transformation, to ignite innovation, and to ensure the economic benefits of this green transformation are felt among businesses, working people and communities alike.

Source: GOV.UK