Vauxhall Maker’s Boss Warns of ‘Disaster’ Over UK’s Net Zero Crackdown

Threat to Pull Out of British Market

The chief executive of Stellantis, the company that manufactures Vauxhall vehicles, has issued a stern warning that the UK government’s net zero crackdown on combustion engines could force the automaker to withdraw from the British market altogether. Carlos Tavares, the outspoken CEO, has lambasted the law aimed at limiting petrol car sales as a “disaster for the UK” that would compel manufacturers to sell vehicles at a loss.

If ministers fail to make urgent modifications to the rules, Tavares suggested that Stellantis might be compelled to drastically reduce the number of cars it sells in Britain – or even cease selling them here entirely. A source close to the company indicated that restricting sales in the UK was the more likely option.

Profitability Concerns and ‘Reality Crash’ for Electric Cars

When queried about the possibility of Vauxhall and Citroën halting model sales in the UK, Tavares was unequivocal: “I’m not going to sell cars at a loss.” He blamed the lacklustre demand for electric cars, which he claims are “crashing in the world of reality” due to high prices, inadequate charging infrastructure, and consumer range anxiety.

According to Tavares, the current “natural” market share of electric cars is merely half of what car companies are mandated to sell under regulations introduced this year. He cautioned that the government’s zero emissions vehicle (ZEV) mandate would force carmakers to slash prices to unprofitable levels in order to meet the targets and avoid punitive fines.

Biggest Intervention from a Major Carmaker

Tavares’ remarks represent the most significant intervention to date from a major carmaker, as others have also recently cautioned that legislation in the UK and Europe is advancing more rapidly than consumer demand. According to the Society of Motor Manufacturers and Traders (SMMT), sales of battery electric models accounted for approximately 15.5% of total car registrations in the first three months of 2024, roughly the same proportion as a year ago.

However, under the ZEV mandate, which the UK implemented in January, at least 22% of cars sold by manufacturers must be electric. This target gradually increases to 80% by 2030, with a total ban on sales of new petrol cars scheduled to take effect from 2035.

‘A Disaster for the UK’

Tavares did not mince words, describing the rules as “a disaster for the UK.” He claimed to have urged Mark Harper, the Transport Secretary, to make changes during a meeting on Wednesday. In a briefing with journalists on Thursday, he elaborated: “It’s very simple. The ZEV mandate is [forcing] carmakers to have a growing EV sales mix every year.

“The problem is the natural demand of the market today in the UK on EVs is half of the mandate. If your mandate is imposing on you a level of BEV [battery electric vehicle] sales mix that is double the natural demand of the market, and if the ZEV mandate puts me in a corner by saying, ‘if you don’t meet this, I’m going to kill you with fines’, the consequence is that everybody will start pushing the BEV, which then totally destroys profitability.

“You would not expect Stellantis to support a red ink business.”

Proposed Solutions and Easing Pressure

To alleviate the strain on carmakers, Tavares has urged the government to combine their allowance for passenger cars and light vans, while also permitting manufacturers to include cars they produce for export towards their domestic targets.

He also warned that compelling carmakers to oversell EVs would leave European carmakers more vulnerable to the threat from low-cost Chinese electric car models. However, he stated that Stellantis opposed the introduction of punitive tariffs on Chinese manufacturers, adding that the company was already “fighting everywhere” for market share and that “protectionism” would ultimately lead to higher prices that hurt consumers.

Affordability and Competitiveness

Tavares emphasized the importance of making EVs more affordable for the middle class, stating: “If you only sell EVs to the wealthy, it doesn’t fix global warming.” He dismissed the notion of reintroducing EV grants that were scrapped in 2022, saying: “I am not asking for incentives. I could. But that [means] more taxes for UK citizens – I don’t think we need more taxes.”

Instead, he proposed an offensive approach: “Why don’t we try to be offensive instead of being defensive against the Chinese, who obviously are demonstrating some kind of additional competitiveness? Why don’t we try ourselves to accelerate, and to use the brains of our people, to move faster in the affordability, in the technology, the manufacturing?”

Discounting and Government’s Stance

This comes after The Telegraph reported that three-quarters of new EVs listed on Auto Trader were being advertised at a discount, indicating that manufacturers and dealers are already being forced to slash prices.

The government has previously insisted that the ZEV mandate will safeguard British industry jobs and is “specifically designed to support existing manufacturers by providing flexibilities so they can comply with targets over time.”

The Department for Transport was contacted for comment but did not provide a statement at the time of writing.

Annual ZEV Mandate targets to 2030

The obsessive move to EVs is already a catastrophe, with owners desperate to dump their EVs and move back to Internal Combustion Engines, sales a plummeting, resale values are sinking and the Chinese are poised to flood Europe with their cut price cars which will not only destroy our car manufacturing, but the threat to our security is sinister, for example;

“How many cars would it take to gridlock London?”

The statement by Vauxhall is not only worrying, but it is also an indication of what is yet to come, should these ridiculous targets continue to be enforced. I have no doubt that the tide will turn, as the push for EVs is unsustainable, but in the meantime, the problem is, that every day, more and more ICEs are being scrapped and we may wake up one day in the near future and find that the EV experiment has collapsed and we will be left short of alternatives with our car production industry in crisis.