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Professor John Clancy and Professor David Bailey
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By Professor David Bailey
16th June 2026
The reported decision by Keir Starmer to overrule Ed Miliband and soften the UK’s electric vehicle sales targets will no doubt horrify some environmental campaigners. But if the reports are accurate, it could prove to be one of the best industrial policy decisions Labour has taken since entering government.
The key point is this: supporting net zero and supporting a more gradual EV transition are NOT contradictory positions. In fact, if we get the transition wrong, we risk undermining both our climate goals and the future of British manufacturing.
The Sunday Times report suggests that the government is considering reducing the requirement for 80% of new car sales to be electric by 2030 down to 50%, following sustained pressure from industry, trade unions. Some academics and business leaders. The rationale is straightforward: current targets are running significantly ahead of actual consumer demand.
That reality has been staring policymakers in the face for some time. As I’ve argued here at Blogs from the Blackstuff, the direction of travel towards electrification is beyond doubt. Road transport remains one of Britain’s largest sources of greenhouse gas emissions and decarbonisation is essential. But recognising the destination does not mean pretending the road there is free of potholes.
The big problem with the current Zero Emission Vehicle (ZEV) Mandate is that it places much of the burden on manufacturers while assuming consumers will automatically follow. They won’t.
That’s not because people are anti-EV, and not because they are climate sceptics. Rather, it’s because most households make decisions based on affordability, convenience and confidence. These factors matter.
At present, many consumers still face higher upfront costs for EVs. And concerns remain over charging infrastructure, particularly outside London and the South East. Questions also persist around residual values and depreciation. Public charging often remains more expensive than home charging, disadvantaging those without driveways.
None of these are insurmountable barriers. But neither can they simply be wished away by setting increasingly ambitious sales quotas.
The danger here is that the last government confused targets with outcomes. And despite tweaks under Labour since inheriting a dogs’ breakfast of a policy, the current framework still risks doing this.
If manufacturers are required to hit sales percentages regardless of underlying market conditions, they have limited options. They discount vehicles heavily. They absorb losses. They divert investment elsewhere. Or, in the worst-case scenario, they reduce UK operations altogether.
That should concern anyone who cares about jobs, production and industrial strategy. It is not properly appreciated that the UK automotive sector supports hundreds of thousands of jobs directly and indirectly. It remains one of Britain’s most important manufacturing industries.
We have already witnessed years of uncertainty surrounding Brexit, energy costs, supply chain disruption and global competition. The last thing the industry needs is a regulatory framework that appears disconnected from market realities.
The irony is that forcing the pace too aggressively could actually slow the transition. That’s because consumers become wary when second hand values collapse. Leasing companies become nervous when depreciation accelerates. And manufacturers become reluctant to invest when profitability disappears. We see that in car makers cutting investment and EVs and extending the life of ICE powered models.
As our blogs here have stressed, the result can become a vicious circle of discounting, falling residual values and weaker consumer demand. That is not a recipe for a successful transition. It is a recipe for market distortion.
Such impacts are often felt by people far removed from Whitehall policy discussions. That is why the voices of manufacturers and trade unions deserve to be heard.
When Unite the Union raises concerns about employment impacts, this is not climate denial. When automotive executives warn about investment decisions, this is not resistance to progress. Rather, it is a recognition that successful transitions require consent as well as ambition. The reality is that Britain needs a more balanced strategy.
That strategy needs to combine steady increases in EV adoption with accelerated charging infrastructure deployment. It needs to better support battery manufacturing and domestic supply chains. It needs to recognise the continuing role of hybrid technologies during the transition period.
Such a strategy needs to provide better incentives for consumers rather than relying overwhelmingly on penalties for producers. And above all, the strategy needs to align targets with actual conditions on the ground.
None of this means abandoning ambition. Far from it. The UK should continue pushing towards electrification. The long-term future of passenger cars is undoubtedly electric. Most manufacturers accept this, and most consumers increasingly accept it too. But the route to that future matters.
A transition that people can afford will succeed. A transition that consumers willingly embrace will endure. And a transition that protects industrial jobs while reducing emissions will command public support.
In contrast, a transition that appears imposed, expensive and disconnected from everyday realities risks generating precisely the backlash that opponents of climate action would welcome.
Good policy is not measured by how ambitious a target appears in a ministerial press release. It is measured by whether it actually works. The reported Starmer intervention may upset some environmental purists. Yet it reflects a broader truth that governments occasionally forget: successful economic transformation requires pragmatism as well as principle.
The challenge is not whether Britain moves towards electric vehicles. It will. The challenge is whether we manage that journey in a way that carries consumers, workers and manufacturers with us.
If the choice is between a realistic transition that succeeds and an unrealistic one that collapses under its own contradictions, the answer should be obvious. Net zero remains essential. But so does keeping Britain’s car industry alive long enough to help deliver it.
The reported decision by Keir Starmer to overrule Ed Miliband and soften the UK’s electric vehicle sales targets will no doubt horrify some environmental campaigners. But if the reports are accurate, it could prove to be one of the best industrial policy decisions Labour has taken since entering government.
The key point is this: supporting net zero and supporting a more gradual EV transition are NOT contradictory positions. In fact, if we get the transition wrong, we risk undermining both our climate goals and the future of British manufacturing.
The Sunday Times report suggests that the government is considering reducing the requirement for 80% of new car sales to be electric by 2030 down to 50%, following sustained pressure from industry, trade unions. Some academics and business leaders. The rationale is straightforward: current targets are running significantly ahead of actual consumer demand.
That reality has been staring policymakers in the face for some time. As I’ve argued here at Blogs from the Blackstuff, the direction of travel towards electrification is beyond doubt. Road transport remains one of Britain’s largest sources of greenhouse gas emissions and decarbonisation is essential. But recognising the destination does not mean pretending the road there is free of potholes.
The big problem with the current Zero Emission Vehicle (ZEV) Mandate is that it places much of the burden on manufacturers while assuming consumers will automatically follow. They won’t.
That’s not because people are anti-EV, and not because they are climate sceptics. Rather, it’s because most households make decisions based on affordability, convenience and confidence. These factors matter.
At present, many consumers still face higher upfront costs for EVs. And concerns remain over charging infrastructure, particularly outside London and the South East. Questions also persist around residual values and depreciation. Public charging often remains more expensive than home charging, disadvantaging those without driveways.
None of these are insurmountable barriers. But neither can they simply be wished away by setting increasingly ambitious sales quotas.
The danger here is that the last government confused targets with outcomes. And despite tweaks under Labour since inheriting a dogs’ breakfast of a policy, the current framework still risks doing this.
If manufacturers are required to hit sales percentages regardless of underlying market conditions, they have limited options. They discount vehicles heavily. They absorb losses. They divert investment elsewhere. Or, in the worst-case scenario, they reduce UK operations altogether.
That should concern anyone who cares about jobs, production and industrial strategy. It is not properly appreciated that the UK automotive sector supports hundreds of thousands of jobs directly and indirectly. It remains one of Britain’s most important manufacturing industries.
We have already witnessed years of uncertainty surrounding Brexit, energy costs, supply chain disruption and global competition. The last thing the industry needs is a regulatory framework that appears disconnected from market realities.
The irony is that forcing the pace too aggressively could actually slow the transition. That’s because consumers become wary when second hand values collapse. Leasing companies become nervous when depreciation accelerates. And manufacturers become reluctant to invest when profitability disappears. We see that in car makers cutting investment and EVs and extending the life of ICE powered models.
As our blogs here have stressed, the result can become a vicious circle of discounting, falling residual values and weaker consumer demand. That is not a recipe for a successful transition. It is a recipe for market distortion.
Such impacts are often felt by people far removed from Whitehall policy discussions. That is why the voices of manufacturers and trade unions deserve to be heard.
When Unite the Union raises concerns about employment impacts, this is not climate denial. When automotive executives warn about investment decisions, this is not resistance to progress. Rather, it is a recognition that successful transitions require consent as well as ambition. The reality is that Britain needs a more balanced strategy.
That strategy needs to combine steady increases in EV adoption with accelerated charging infrastructure deployment. It needs to better support battery manufacturing and domestic supply chains. It needs to recognise the continuing role of hybrid technologies during the transition period.
Such a strategy needs to provide better incentives for consumers rather than relying overwhelmingly on penalties for producers. And above all, the strategy needs to align targets with actual conditions on the ground.
None of this means abandoning ambition. Far from it. The UK should continue pushing towards electrification. The long-term future of passenger cars is undoubtedly electric. Most manufacturers accept this, and most consumers increasingly accept it too. But the route to that future matters.
A transition that people can afford will succeed. A transition that consumers willingly embrace will endure. And a transition that protects industrial jobs while reducing emissions will command public support.
In contrast, a transition that appears imposed, expensive and disconnected from everyday realities risks generating precisely the backlash that opponents of climate action would welcome.
Good policy is not measured by how ambitious a target appears in a ministerial press release. It is measured by whether it actually works. The reported Starmer intervention may upset some environmental purists. Yet it reflects a broader truth that governments occasionally forget: successful economic transformation requires pragmatism as well as principle.
The challenge is not whether Britain moves towards electric vehicles. It will. The challenge is whether we manage that journey in a way that carries consumers, workers and manufacturers with us.
If the choice is between a realistic transition that succeeds and an unrealistic one that collapses under its own contradictions, the answer should be obvious. Net zero remains essential. But so does keeping Britain’s car industry alive long enough to help deliver it.
John Clancy and David Bailey