From then it will be electric vehicles only with hybrids also being phased out from 2035. Reaction within the industry has been mixed, but largely positive. The main concern being over establishing an adequate charging infrastructure.
The Government has pledged some £2.8 billion to help create this along with a number of battery gigafactories
Steve Nash, Chief Executive of the Institute of the Motor Industry, said: “We knew it was coming, but of course the implications for the automotive industry are monumental; manufacturers now know that they must replace their entire product offering with electrified vehicles in less than 10 years. That can surely only mean that their ranges will shrink significantly compared to today. Let’s hope that consumer choice remains front and centre.
“Whilst the devil is certainly going to be in the detail, and the IMI welcomes the opportunity to engage with government to provide input for its plans, we are concerned that, as usual, it seems little thought has been given to the swathe of businesses and individuals employed by the automotive industry beyond manufacturing.
“Yet it is this ecosystem – from the distribution chain of car dealers to service and repair and even accident recovery – that fundamentally underpins the government’s ambitions. If the new parc of electric vehicles can’t be serviced and repaired safely the whole plan will stall on the starting grid.
“Currently around just 5% of UK automotive technicians are adequately trained to work on electric vehicles. The ramp-up plan for all those who are likely to work on electrical vehicles – from service and repair technicians to those working in the roadside recovery and blue light sectors – now must be addressed as a matter of urgency. And that means some of that £12bn investment promised by the Prime Minister needs to be put towards skills training.”
Nash said the industry is currently a long way off achieving a critical mass of technicians qualified, with COVID-19 setting it back significantly in reaching optimum numbers in time for 2035, let alone 2030.
- There are around 245,000 automotive technicians, working on 38 million registered vehicles in the UK.
- As of October 2020 there were 383,000 plug in cars and vans registered. It is predicted that this will increase to between 2.7 to 10.6 million by 2030[i].
- Taking the top estimate (due to unexpected increase in sales in the past 3 months), the IMI calculates that the UK would need approximately 70,500 qualified technicians to support this vehicle parc.
- The IMI estimates that there are between 13,000 and 20,000 technicians currently qualified to work on electric vehicles – which means a requirement of between 50,000 and 57,000 technicians by 2030.
- Pre COVID-19, the market was on course to achieve critical mass; 6,500 certificates for working on electric vehicles were issued in 2019. If that rate had continued the minimum required qualified technicians would have been reached by 2030. However 2020 Q2 numbers were down 85% compared to the same period 2019.
The Electric Vehicle Association, of course, welcomed the UK Government’s decision which it said supports ‘big picture’ issues such as the UK’s ambition to have net zero CO2 emissions by 2050 to combat climate change, and the urgent need to improve local air quality.
However, the EVA acknowledged that in the run up to the 2030 phase-out date there are still a number of challenges to be addressed, ranging from supporting motorists to be able to switch to electric vehicles in the most affordable way possible, to ensuring drivers have confidence in the UK public charging network.
The government has also announced that it will “allow the sale of hybrid cars and vans that can drive a significant distance with no carbon coming out of the tailpipe until 2035”. Although the details are yet to be confirmed, it is expected that this will primarily relate to certain plug-in hybrid electric vehicles (PHEVs) and range-extended vehicles.
Both of these technologies offer a stepping stone that has helped many motorists and commercial operators to make the transition from petrol and diesel engines to electric, and they can help to reduce vehicle emissions if driven primarily on electric power.
Alan Bastey, Customer Relationship Director and EV specialist at fleet management specialist Zenith, said the Government’s announcement will help businesses focus on their future mobility requirements and the change is only two or three fleet cycles away for the average company.
He added: “Moving to an electric vehicle can be daunting for drivers, so companies need to design a policy that helps to inform employee choice and remove the perceived barriers. We see that engagement and education are pivotal to successful uptake.
“Demand for BEV passenger cars continues to grow, supported by growing choice, improved affordability and availability.”
Zenith said fleets are seeing the long-term financial benefits of BEV and helping employees to make the switch. It considers a typical annual mileage for a BEV of 8,000 to 10,000 miles.
The consulting team at Zenith is working with fleet operators of cars, vans and trucks to model the Whole Life Cost (WLC) methodology to assess the impact of BEVs and often as part of their wider roadmap to ‘net zero’. While electric vehicles are often more expensive in rental costs, the savings obtained from fuel and employer’s NI can usually offset the higher rental.
Companies should also consider that low emitting cars have further corporation tax benefits as they are not subject to lease rental restriction and a lower 6% capital allowance rate. It will be even more relevant from April 2021 when the threshold for these benefits is lowered to 50 g/km from 110 g/km.
Ashley Barnett, Head of Consultancy at Lex Autolease, said: “2030 will come around particularly quickly for businesses with large fleets of traditionally-fuelled cars and vans. With the new target, they’ll have just over two replacement cycles to make the shift. Although more businesses are exploring switching to electric vehicles already, this announcement makes the transition much more pressing and firms will need to start to act now.
“An acceleration of the UK’s EV infrastructure rollout, incentivising new and used purchases, plus investing in renewable electricity sources and making the UK attractive to BEV suppliers in a global market must be at the top of the agenda if we are ever going to hit this ambitious deadline.
“We’ve heard plenty of pro-EV rhetoric. Now it’s time for government departments and industry bodies to come together to help the UK transition to a net-zero future.”
Brian Madderson, Chairman of the Petrol Retailers Association (PRA), said: “The PRA supports the process of decarbonisation, but we need a comprehensive plan to reduce carbon emissions that works across sectors and industries, including aviation.
“The plan to ban sales of internal combustion engine (ICE) vehicles by 2030 will force the UK to become dependent on Chinese battery technology. Our members strongly feel that government has not done enough to develop low carbon liquid fuels and hydrogen as an alternative to EVs, particularly when the German authorities are investing €7 billion into speeding up the market rollout of hydrogen technology.
“For context, the French government have announced over €30 billion worth of green funds, yet are sticking with a 2040 ban. Even with their sizable investment, they do not believe any date sooner is economically and practically feasible.
“Technical and commercial challenges remain in establishing the electric charging infrastructure required for mass EV take-up. This is particularly apparent at petrol forecourts where many of our members have abandoned plans to install ultrarapid charging points. This is due to a lack of local power sub-stations, onerous regulation and lack of return on investment.
“People driving used ICE vehicles are generally those with less disposable income. Penalising ICE drivers who can’t afford to make the transition to an EV is no way to foster a new market in alternative fuels and, as ever, the biggest tax burden will fall on those least able to afford it.”
Ian Johnston, Chief Executive of Osprey Charging said that the spotlight is now on industry and Government to ensure that the necessary charging infrastructure is in place to make the switch to electric as frictionless as possible for motorists.
He added: The private sector is deploying a vast network of reliable and accessible public charging points and the Government must also step up action to fund infrastructure in rural areas and create an attractive trading environment for EV supply. When broadband was rolled out, we saw huge delays in rural areas, the effects of which are still felt today – we must not let that happen again.”
As for the automotive industry in general, Mike Hawes, Chief Executive of the Society of Motor Manufacturers and Traders, said: “We share government’s ambition for leadership in decarbonising road transport and are committed to the journey. Manufacturers have invested billions to deliver vehicles that are already helping drivers switch to zero, but this new deadline, fast-tracked by a decade, sets an immense challenge.
“We are pleased, therefore, to see Government accept the importance of hybrid transition technologies – which drivers are already embracing as they deliver carbon savings now – and commit to additional spending on purchase incentives. Investment in EV manufacturing capability is equally welcome as we want this transition to be ‘made in the UK’, but if we are to remain competitive – as an industry and a market – this is just the start of what’s needed.
“Success will depend on reassuring consumers that they can afford these new technologies, that they will deliver their mobility needs and, critically, that they can recharge as easily as they refuel.
“For that, we look to others to step up and match our commitment. We will now work with government on the detail of this plan, which must be delivered at pace to achieve a rapid transition that benefits all of society, and safeguards UK automotive manufacturing and jobs.”