Electric vehicle transition has stalled but political will can deliver benefits to UK

In an article published by the University’s policy engagement unit, Policy@Manchester, Dr James Jackson recalls that the Government’s flagship industrial strategy launched in 2017 envisaged a post-Brexit future in which EVs were identified as “an important opportunity for the UK political economy.”

He writes: “Yet, despite the almost annual publications that reiterated the need for EVs to become a significant feature of the UK, attempts to develop a domestic EV industry have stalled, if not entirely failed.”

Dr Jackson shines a spotlight on “a series of obstacles and roadblocks” which, he believes, “have prevented the UK EV industry from building any real momentum.”

These include a lack of Treasury support, and a weak commitment from manufacturers including Tesla “which cited the reduced ease of trade with the European Union, and the prospect of slowing the UK’s Just-in-Time model, as reasons to set up base elsewhere.” He points out that, whilst consumers initially responded positively to supply side reforms such as exempting EVs from Vehicle Excise Duty and demand side subsidies including offsetting the upfront cost of the cars, “these have since been dismantled.”

Dr Jackson, a postdoctoral fellow at the university’s Sustainable Consumption Institute, reminds readers that last year’s by-election in former Prime Minister Boris Johnson’s Uxbridge seat was dominated by the issue of Ultra-Low-Emission-Zones (ULEZ), an associated measure to support EV development which continues to be contentious.

He writes: “Whether the desire to see the UK as a central component in the EV supply chain still exists within the halls of government and the private sector at large, is debatable. In the absence of the industrial modernisation once envisaged having not come to fruition - whether it was the result of a dearth of capital, ambition, or indeed competence - raises an array of questions. Yet, the imperative to meet climate objectives, notably the Paris Agreement, remains.”

The University of Manchester academic stresses that the current political and economic landscape, “defined by supply-side disruptions, high-interest rates and contracted economic activity,” continues to offer legitimate means to accelerate the EV transition.

And he advances two policy proposals to help inject the necessary momentum: adjusting Treasury fiscal rules to allow for consistent capital funding for low carbon technology, including EV; and the Bank of England agreeing to introduce lower interest rates for ‘green’ lending compared to carbon intensive industries and goods.

Dr Jackson concludes: “Whether any of the measures are implemented or indeed designed might yet rest on the outcome of the 2024 General Election. Either way, returning to the EV transition as a vehicle for economic change remains an obvious and increasingly imperative place to start for the UK moving forward toward the zero emissions mandate in 2035.”

‘Accelerating the electric vehicle transition in the UK’ by Dr James Jackson is available to read on the Policy@Manchester website.