Car makers try to force fleets to accept EVs they don’t want

In the United Kingdom, not only are sales of BEV light commercial vehicles falling, year-to-date, but the decline means that some car makers are looking to restrict the number of internal combustion engine (ICE) powered vehicles they bring into the country, in order to avoid breaching their mandated quotas.

Car companies are trying to ‘encourage’ fleet buyers to accept more BEVs than they might want or need in order to comply with the 2024 quota demanded by the UK government.

The Zero Emission Mandate stipulates that 22% of passenger cars and 10% of light commercials (vans) sold must be zero emission vehicles, but this is just the start as the rules insist that by 2035 100% of all new cars and vans sold in the UK are zero emissions.

On route to that is the requirement for 80% of cars and 70% of vans to be zero emitters by 2030, just six years away.

Some mainstream car brands are threatening they may limit the number of petrol and diesel vehicles they bring into the UK market to ensure they comply with the quota, which will have a negative effect on their sales throughput and profitability, as well as that of their dealers, plus it could raise prices for consumers and have an inflationary effect, as well.

A further knock-on effect could be to keep older, dirtier cars on the road for longer, as consumers recoil at new car prices. On the positive side, it would bring price parity between ICE and EV closer sooner, though elevating ICE prices towards EVs rather than EVs declining towards ICE pricing.

According to UK industry website Fleetnews.co.uk, some fleet buyers are effectively being blackmailed into accepting delivery of EVs they do not want or need in order to have their ICE fleet orders filled.

Some potential customers are being told their orders have to reflect the quota the government is imposing on the car makers, effectively 22% of cars and 10% of vans in any order will have to be ZEVs, which for fleets planning to buy in 2030 would mean that 80% and 70% respectively would have to be ZEVs too. However if the car makers carry through on their threat of reducing supply to mimic the quota requirements, buyers will have little choice but to comply.

The bad news for manufacturers and the UK government is that sales of EVs, while up on 2023, has started to slip.

According to Fleetnews.co.uk, quoting Society of Motor Manufacturers and Traders numbers for April, sales of Zero Emission Vans fell 42% on the same month last year, accounting for only 3.6% of all van sales, down from 6.6% in April 2023.

In the van market, only 5800 BEV vans were delivered in the first four months of 2024, down more than 3% on last year and accounting for only 4.9% of the total van market. YTD Diesel-powered van sales rose 8% and other ICE sales rose 36% but accounting for only a 2% market share.

Overall (ICE and EV combined) van sales continue to rise compared with 2023, making the decline in interest in zero-emission vans all the more notable.

Naturally, the industry is now calling on the UK government to institute incentives in order to drive the market towards EVs, and the manufacturers continue to pour more and varied product into the market, for which there appear to be fewer and fewer buyers.

This won’t end well.