MPs push for earlier ZEV mandate review as pressure grows on UK car makers

May 28, 2026

MPs are calling on the Government to bring forward its planned review of the UK’s ZEV mandate, warning that current rules are putting growing financial pressure on manufacturers.

The cross-party Business and Trade Committee says waiting until 2027 for a review is too slow, arguing that car makers are already being forced into heavy EV discounting to hit increasingly strict electric vehicle sales targets.

Under the current ZEV mandate, manufacturers must sell a rising proportion of electric vehicles each year or face fines.

The committee claims the rules are now “severely hurting profit margins”, with some UK-based manufacturers also buying compliance credits from rival overseas brands to avoid penalties.

For fleets and company car drivers, the debate matters because the ZEV mandate has played a major role in driving aggressive EV pricing, lease support and manufacturer incentives across the market over the past 18 months.

That has helped accelerate affordability for electric company cars, particularly through salary sacrifice and business lease deals.

However, growing industry pressure also highlights wider concerns surrounding EV profitability, residual values and long-term sustainability as manufacturers continue racing to meet sales quotas.

The committee is now calling for a wider market review balancing decarbonisation targets with the competitiveness of UK vehicle manufacturing.

Meanwhile, EV industry groups argue demand for electric cars continues to grow, with around two-thirds of petrol and diesel drivers now considering switching to EVs.