What does the ZEV Mandate Mean for Fleets?

The UK’s Zero Emission Vehicle (ZEV) mandate is driving major changes across the automotive industry. As manufacturers accelerate the production of zero-emission vehicles, fleets will need to balance their environmental goals with operational needs. This requires a new level of fast decision-making, access to funds, and clear data.

What is the ZEV Mandate?

The ZEV mandate is a government policy that requires vehicle manufacturers to sell a certain percentage of electric vehicles (EVs) each year, increasing to 100% by 2035. This is a big push to accelerate the transition from petrol and diesel vehicles to EVs, as part of the UK’s goal of net-zero emissions by 2050.

What are the Targets?

To meet the mandate, manufacturers must hit specific targets for electric car and van sales:

If these goals are met, then 80% of new cars, and 70% of new vans sold in the UK will be zero emission by 2030, rising to 100% by 2035. While the new Labour government recently proposed reinstating the 2030 target, this change has not yet been officially confirmed (as of August 2024).

Manufacturers who don’t meet these targets face fines – starting at £15,000 per non-compliant car, and £9,000 per non-compliant van in 2024 (rising to £18,000 thereafter).

While 100% electric brands like BYD, Polestar, and Tesla are well ahead of these targets, other manufacturers such as Ford, Mazda, and Suzuki have a much lower percentage of EV sales. But despite overall new electric car registrations being 18.5% in July 2024, the industry is expected to meet this year’s mandate through a credit-based system, where manufacturers can ‘borrow’ credits from future years if they exceed targets in the past, or trade these credits with other manufacturers.

What about HGVs?

The Government did announce that all new HGVs in the UK will be zero-emission by 2040, however this isn’t currently included in the ZEV mandate. So there’s still some uncertainty about these targets.

Impact on the UK Fleet Market

As manufacturers focus on zero-emission vehicles, fleets may find it harder to access new petrol and diesel models.

This does mean however that there should be a wider availability and choice of suitable EV replacements. This, together with government incentives like zero-emission company car tax breaks and plug-in vehicle grants will make electric vehicles more accessible to the wider market.

It’s important to proactively plan for zero-emission replacements for your ICE vehicles on fleet, and ensure your drivers will have access to suitable charging infrastructure.

Maximising Opportunities

For fleets, timing is key. If your fleet is flexible, you can hold onto vehicles with strong resale value and then capitalise on EV deals when they come up. With Holman’s flexible funding methods this means our customers are free to de-fleet their ICE vehicles at a time that suits them – without any early termination penalties.

Next Steps

If you haven’t already, now is the time to assess your fleet’s needs and start planning your transition to electric vehicles. You don’t have to go it all at once, or on your own. We can help with a phased approach to EV adoption to see how it will work for your business. The best strategy is to be prepared and ready for when the best time comes. We’re here to help, check out how Holman’s EV Consult supports your transition to an EV fleet.