Keir Starmer hands car brands extension from petrol and diesel 2030 vehicle ban

A handful of car companies are set to be exempt from the 2030 ban on new petrol and diesel as part of new plans drawn up in the wake of UStrade tariffs.

In a speech today, Prime Minister confirmed that Labour would be pushing ahead with its manifesto promise to ban the sale of new petrol and diesel cars from 2030. In 2023, the former Tory government changed its plan, pushing the ban back to 2035, which at the time aligned with the EU and other global markets.

Labour promised to reverse this decision when it came into power. However, there was some doubt over the plan after announced major global tariffs on April 1, which included a minimum of 10% tariffs on all imports and additional taxes for around 60 countries.

President Trump also imposed a 25% levy on cars imported to the US, which is a major export market for the UK motor industry.

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In a speech today, Sir Keir Starmer confirmed that Labour would be committing to its promise. To help car companies with the transition, some changes have been made to manufacturing targets for electric cars and vans. Some companies will also be spared from electric car sales quotas.

Under the Zero Emission Vehicle (ZEV) mandate, manufacturers will be fined if they miss targets for new electric vehicle sales as a proportion of total sales each year. However, supercar brands, including McLaren, Aston Martin and Bentley, will be exempt for them.

These firms will be “be allowed to make combustion engine supercars” beyond 2030, but with tighter rules on carbon emissions. This is because they only manufacture a small number of vehicles per year. On the move, a government statement this would help “preserve some of the UK car industry’s most iconic jewels for years to come".

Currently, 28% of new cars sold in the UK this year must be electric, a target that will rise each year until 2030. However, the new rules will give car manufacturers more freedom in how they meet their yearly targets. This means if they don't sell enough electric vehicles in one year, they can make up for it by selling more the next.

In addition, petrol and diesel vans, hybrids, and plug-in hybrid cars - which combine a petrol or diesel-powered engine with an electric motor - will be allowed to be sold until 2035, which will benefit firms such as Ford and Stellantis.

The UK will also be maintaining its existing carbon dioxide scores for plug-in hybris rather than changing them to the revised higher rates being used across the EU. According to UK officials, this move will benefit BMW and Land Rover, whose parent company has suspended shipments of vehicles to the United States this month due to the tariffs.

The fine of £15,000 per vehicle sold that does not meet the latest emissions standards will also be cut to £12,000, and the car industry will receive £ 2.3billion in tax breaks overall.

Officials have said support for the car industry will continue to be kept under review as the full impact of the tariffs announced last week becomes clear. Starmer said the measures would "boost growth that puts money in working people's pockets" and ensure "home-grown firms" can export UK-made cars worldwide. The revised rules ar set to come into effect this year, subject to changes to secondary legislation.

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