Stellantis is on the verge of making a crucial decision regarding its operations in the UK, following extensive talks with the government concerning the country’s zero-emission vehicle (ZEV) sales mandate, reported Bloomberg, citing CEO Carlos Tavares.
The automotive giant, which owns the British brand Vauxhall, has been vocal about the challenges posed by the mandate, suggesting it could shift production if the current requirements are deemed unsustainable.
Go deeper with GlobalData
Recently, Tavares told Bloomberg Television that the UK government has set a threshold for battery-electric vehicle (BEV) sales that is approximately twice the “natural” level of demand.
Stellantis CEO highlighted that if European governments expect the company to exceed natural demand for EVs, “they need to help to stimulate the demand.”
He noted that this issue has been under discussion with the UK for several months and added, “We are now reaching a point where we have to make a decision, and that will happen in the next few weeks.”
The UK’s ZEV mandate, which took effect this year, requires that 22% of each manufacturer’s new car sales be zero-emission, a figure set to rise to 80% by 2030.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalDataSimilarly, for vans, electric sales must reach 70% by the end of the decade.
Automakers that fall short of these targets could face fines of up to £15,000 per vehicle, although they can mitigate penalties through a credit-trading programme and catch up in subsequent years.
The timing of Tavares’ statement coincides with the UK government’s efforts to attract foreign investment through an investment summit.
Stellantis has invested £100m ($130m) in converting its Ellesmere Port site into an electric-only plant for small vans across its Vauxhall, Citroën, Peugeot, Opel, and Fiat brands.
The company also produces mid-size vans in Luton, near London.
Concerns about the UK automotive sector’s future have been echoed by the Institution of Mechanical Engineers (IMechE), which recently reported that the UK is ‘behind the curve’ in transitioning to a net-zero fleet and meeting net zero goals.
The IMechE warned that the ZEV mandate alone is insufficient to drive the transition without a receptive market and called for additional government policies to boost EV adoption.
The institution also stressed the need for more support and incentives for car manufacturers operating within the UK.
