No carmaker in the UK is expected to face fines for missing electric vehicle (EV) sales targets in 2024, according to a recent analysis. Most manufacturers either met their targets or can use flexibilities to avoid penalties, with the exception of Japan’s Suzuki, which will need to buy credits from other companies to stay compliant.
Under the UK’s Zero-Emission Vehicle (ZEV) mandate, carmakers must progressively sell more EVs each year, a policy introduced by the previous Conservative government to help reduce carbon emissions. If carmakers fail to meet their targets, they face fines up to £15,000 for every fossil fuel car sold beyond their quota.
In 2024, the target was for 22% of all car sales to be fully electric, a figure set to rise to 28% in 2025 and 80% by 2030. The actual share of electric vehicles sold in 2024 reached a record 19.6%, but manufacturers can also take advantage of "flexibilities" that let them earn credits by reducing emissions from the fossil fuel cars they sell or by borrowing credits from future years. This has made it easier for most carmakers to meet the target without facing penalties.
T&E (Transport & Environment), the group behind the analysis, estimates that the real sales target for 2024 was around 18%. They argue “Surging EV sales in 2024 prove the mandate is working – carmakers are hitting targets. Now the government must maintain ZEV mandate ambition to continue to drive down costs for consumers, and focus on delivering a robust industrial strategy for the sector to support UK automotive manufacturing.”
According to T&E’s report, brands like BMW, Mercedes-Benz, Volvo’s parent Geely, Tesla, and BYD all met the target through EV sales alone and can even sell credits to others who need them. However, other manufacturers, like Volkswagen, Ford, Toyota, and Jaguar Land Rover, will likely need to use these credits or other flexibilities to avoid penalties.
Despite this, many in the industry argue that the current demand for EVs isn’t enough, forcing them to offer large discounts to attract buyers. Mike Hawes, CEO of the Society of Motor Manufacturers and Traders, said “Manufacturers are having to make up the shortfall between the ambitions of the ZEV mandate and market realities, a gap which has already cost the industry around £4.5bn in discounts alone,”
“This is a huge cost which cannot be sustained indefinitely but, with the mandate compelling EV market growth of around 50% this year, the costs look likely to increase even further, threatening jobs, market growth and business viability.”
There are also discussions within the government about potentially adjusting the flexibility rules while maintaining the overall sales targets. Some carmakers, like Suzuki, which didn’t sell any electric cars in 2024, are planning to launch new EV models this year and will explore ways to avoid penalties, such as trading credits.
In the meantime, industry lobbying is pushing for adjustments to the ZEV mandate, particularly as sales growth in the EV sector has plateaued. Some manufacturers are hoping that these changes will help them avoid fines in the coming years, particularly in 2026.
