16:18 Heidi Alexander (Labour)

With permission, I shall make a statement about the zero emission vehicle mandate. Today, this Government are giving British car makers certainty and support on the transition to electric vehicles, as we set out plans to back industry in the face of global economic headwinds. We have worked in close partnership and at pace with colleagues in the Scottish Government, the Welsh Government and the Northern Ireland Executive, whom I would like to thank.

The automotive industry is a cornerstone of our economy. It supports over 150,000 jobs and generates £19 billion every year. Today, with Government backing, it must negotiate the turbulence of fresh global economic challenges. For too long, the sector has been held back by a lack of long-term certainty. That changes now. This Government listen and act. We have listened to car manufacturers, large and small, from Sunderland to Solihull, and from Crewe to Coventry. Car makers have told us what they need to not just survive, but thrive. What they want is what we are delivering: practical, sensible reforms that will unlock investment, protect jobs and strengthen Britain’s leadership in the zero emissions transition.

Today, I can confirm that the Government are maintaining our manifesto commitment to phasing out the sale of new petrol and diesel cars by 2030. I can also reconfirm our commitment to all new cars and vans being 100% zero emission from 2035; there are no changes to the trajectory of the transition set out in the ZEV mandate regulations. We support the role of hybrid vehicles as a crucial stepping-stone in that journey; new full hybrids and plug-in hybrids will be on sale until 2035. That strikes the right balance. We are being firm on our climate commitments, but flexible on how we meet them, because our aim is not to impose change for its own sake, but to enable industry to make the transition in a way that matches supply with demand, and to support businesses, and the jobs that they provide, every step of the way.

We are also reducing fines for missing ZEV targets from £15,000 to £12,000 per vehicle. Where fines are levied—for the vast majority of manufacturers, they will not be—the revenue will be recycled directly back into support for the sector, because this Government invest in solutions and do not punish ambition. Let me be clear: this is not a retreat from our ambitions on EVs—quite the opposite. It is right that the threat of fines remains, as it is an inescapable fact that the domestic transport sector remains the UK’s single largest carbon emitter, accounting for 30% of emissions in 2024. That is why we are doubling down on our commitment to the electric transition. There is more than £2.3 billion available to support industry and consumers. That includes funding for new battery factories, EV supply chains and charging infrastructure, and grants for zero emission vehicles.

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16:27 Gareth Bacon (Conservative)

However, on the substance of the right hon. Lady’s statement, I cannot share her enthusiasm for the rest of Labour’s plans. The reality is that today, Labour is simply trying to clear up the uncertainty that it has contributed to. When the previous Conservative Government reacted to sluggish automotive trade figures by making the pragmatic decision to delay the ban on new diesel and petrol cars from 2030 to 2035, aligning the UK with major global economies such as France, Germany, Sweden and Canada, Labour accused us of undermining the automotive industry. This morning, the Secretary of State criticised the previous Government for chopping and changing, and a consultation put out by Labour claimed that our policies caused “great harm” to the UK’s reputation as a leading nation in the EV transition by moving the goalposts. However, that is precisely what Labour did upon taking office by ideologically reversing the 2035 deadline. The plans announced over the weekend do not place the automotive sector in a better position than it was when we left office, despite some minor adjustments to the zero emission vehicle mandate.

Indeed, despite today’s announcements, the Society of Motor Manufacturers and Traders has stated that zero emission vehicle mandate targets remain “incredibly challenging”. In its words:

“We welcomed our announcement of the increased flexibilities in the zero emission vehicle mandate, and the clear commitment from Government to incentivise electric vehicle uptake and invest in infrastructure.”

I can assure my hon. Friend that I will continue to work across Government with colleagues in the Department for Energy Security and Net Zero, and in the Department for Business and Trade, in order to make the take-up of EVs as affordable as possible for individuals who want to make the transition. He is entirely right to point out that, compared with a petrol car, drivers can save up to £1,000 a year if they mostly charge at home, and that an EV can be run for as little as 2p per mile if charged at home. Half of all used electric cars are now sold for under £20,000, and there are 29 brand-new electric cars on the market for under £30,000.

I thank the Secretary of State for her statement. Pace is needed, understandably, but I do have some concerns in that due process needs to be followed with the devolved Administrations. Can she assure the House that sufficient time is being allowed for the devolved Administrations, including the Scottish Government, to be fully involved and engaged in a consultation on policy development, and the Scottish Parliament for any legislative changes that may be required? Secondly, what assessment has been made of the potential for those changes to impact negatively on carbon emissions in the UK and Scotland, and our respective Governments’ ability to meet statutory climate change targets? Will she publish any such assessments?

Workers at BMW Cowley have made clear to me their determination to play their part in a jobs-rich transition to net zero. Can my right hon. Friend explain how these changes will benefit BMW Cowley specifically, given its significance for my constituency and for UK manufacturing as a whole?

We are confirming today that we will maintain the existing CO2 scores for plug-in hybrids instead of using the revised scores that are now being used in the EU. That will be of particular benefit to BMW and the Mini Cowley plant.

The Transport Secretary omitted to mention that UK car production last year was at its lowest level for 70 years, aside from the pandemic; that UK car production this year is down a further 11%; and that total registrations of electric and hybrid cars this year are down another 2%. Will the Minister agree that the best thing to do to ensure growth and increase production is to scrap all these ridiculous zero emission targets forthwith?

I am concerned about public health. We all know that diesel and petrol hybrids are not zero emission, we know that the 2035 extension is not about tariffs—it applies only to UK sales—and we know that the move was already on the cards since Labour ripped clean air out of its manifesto completely. Has the Secretary of State assessed the impact of the announcement on the achievement of clean air target commitments? Is this the last we will hear of any clean air Act from this Government?

I do not know which businesses the shadow Secretary of State or indeed the hon. Member for Boston and Skegness (Richard Tice) have been listening to, but I have spoken to businesses including Honda, whose European headquarters are just outside my constituency, and they have said that they are committed to decarbonisation but had concerns about the inflexibility of the scheme that we inherited from the Conservative party. Does the Secretary of State agree that the statement shows that Labour is the party on the side of the British car industry, and of the industry across the world?

The statement today is further evidence of the economically damaging and market-distorting impact of the unrealistic net zero policies. The only reason that the Minister is having to impose fines on producers is that demand does not meet the targets that she has set for the production of electric vehicles. Does she not accept that the response from producers will be either to cut back production, reducing jobs, or to reduce the price of EVs, reducing profits and investment in the UK? Are car workers going to be the next group of workers to be sacrificed on the altar of net zero?

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