SIR Keir Starmer’s net zero reforms will not be enough to shield the car industry from Donald Trump’s punishing tariffs, car makers have warned.
The PM today confirmed petrol and diesel vans and hybrids will stay on sale until 2035 and he slashed fines for manufacturers who miss green targets.
In a speech at a Jaguar Land Rover plant in the West Midlands, Sir Keir also revealed he will pump in £2.3bn to help fund the EV switch.
The move comes after the US president introduced a 25 per cent levy on all foreign-built cars which are imported into the country.
The US is a major export market for the UK motor industry, and the 25 per cent levy is separate to the 10 per cent tax on most UK products introduced by Trump last week.
The Prime Minister said: “This is a moment for cool heads, nobody wins from a trade war, you know that.
“But it’s also a moment for urgency, because we’ve got to rise together as a nation to the great challenge of our age – and it is the great challenge – which is to renew Britain so we’re secure in this era of global instability.”
Sir Keir said “this is not a passing phase” and was a “completely new world”, with the economic turbulence following the defence and security instability caused by the war in Ukraine.
He added: “Let me be really clear, at a moment like this, our future is in our hands, and so of course, we will keep calm and fight for the best deal with the US, and we’ve been discussing that intensely over the last few days.
“But we are also going to work with our key partners to reduce barriers to trade across the globe, to accelerate trade deals with the rest of the world, and champion the cause of free and open trade right across the globe.”
But Stellantis UK chief Eurig Druce, which owns Vauxhall, said further measures would be needed to stimulate sluggish demand.
Mr Druce said: “Whilst more people are moving to electric, it’s not yet at the pace of the ZEV mandate. We welcome the flexibilities to allow our customers more freedom of choice.
“However, there is still a need to address market demand and introduce measures to stimulate it.”
Ford UK boss Lisa Brankin also insisted Sir Keir’s measures were a “small step in the right direction”, but fell short of the “giant leap required to address the especially challenging electric vehicle market conditions”.
She added: “What the UK needs is real incentives to help consumers make the switch to electric mobility.”
Meanwhile, Ian Plummer, of Auto Trader, said “the measures are still not enough” to make EVs an affordable and attractive proposition.
He added: “At this critical moment for the global economy, ministers should underpin consumer demand with tax breaks, such as cutting VAT on public charging.”
Reform UK Nigel Farage urged the PM to “scrap net zero and strike a trade deal with the US”.
He told The Sun: “Ultimately all UK manufacturers are being hammered by the highest energy costs in the world.
“Instead of tinkering around the edges, it’s time to scrap net zero, scrap the subsidies and reindustrialise the UK.”
Shadow Business Secretary Andrew Griffith also raged: “This speech is thin gruel for families and businesses who are being punished with higher costs, more expensive cars and higher bills thanks to this Labour government’s mad rush to Net Zero.
“As Kemi said: Net Zero by 2050 is impossible. It will cripple business and saddle families with higher and higher bills.”
Here’s what the Government’s shake-up means for you and the cars on Britain’s roads:
Electric Vehicle Targets Watered Down
Under the Zero Emission Vehicle Mandate, 28 per cent of all new cars sold in the UK this year must be electric.
But that number is supposed to rise every year until it hits 100 per cent by 2030.
Under the new rules, car companies will be given more breathing space to meet their annual targets.
They will be allowed to borrow credits from future years to avoid being hit with fines, right up until 2029.
This new flexibility helps firms hit their long-term goals without short-term punishment.
Fines Cut for Manufacturers
Under the original plan, firms had to cough up £15,000 for every petrol or diesel car sold that didn’t meet the emissions target.
That is now being slashed to £12,000.
Five More Years for Hybrids
Hybrid cars – which use both a petrol engine and an electric motor – were due to be banned in 2030.
Now they’ll stay on sale until 2035, giving drivers more flexibility to ease into the switch to electric.
It means popular models like the Toyota Prius and Nissan e-Power won’t disappear from car showrooms just yet.
Small British Firms Get A Pass
British brands like Aston Martin and McLaren will be allowed to carry on making petrol cars after the 2030 ban, thanks to an exemption for low-volume manufacturers.
It means iconic British motors will still be roaring down the road long after electric becomes the norm.
Win For White Van Man
New petrol, diesel and hybrid vans will be allowed until 2035 – giving tradespeople and delivery drivers five extra years to make the switch.
No new technology requirements will be imposed.
Instead, from 2030 to 2035, van makers must simply ensure their average CO2 emissions don’t get worse than 2021 levels.
