Skip advert
Advertisement

Electric cars made in Europe face £3,400 UK price hike from January

Failure to renegotiate EU-UK Brexit trade deal will mean tariffs make Europe’s electric cars uncompetitive in the UK market, industry body warns

Nissan Plant Sunderland

The clock is ticking on the threat of swingeing new tariffs on British built electric cars sold in the European Union and their EU built rivals sold in the UK, as the implementation date for tough new Rules of Origin requirements looms.

A deal agreed between the UK and EU as part of the Brexit negotiations means that from January next year EVs traded across the channel must have 45 per cent ‘local content’ from either market, while their batteries must have between 50 and 60 per cent local content.

Advertisement - Article continues below

The rules were agreed before the Covid pandemic and before Russia’s war on Ukraine, and the ensuing supply chain shortages have helped to make meeting the rules of origin targets on batteries impossible for EVs currently built in either the UK or Europe, the car industry says.

If the deal isn’t renegotiated, a 10 per cent tariff will be applied automatically to EVs traded between the UK and EU, which the Society of Motor Manufacturers and Traders says will add £3,400 to the cost of an EU-produced EV sold here, and £3,600 to the cost of a UK-made EV sold in Europe.

Internal combustion-engined cars are not impacted by the new tariffs, meanwhile, because they don’t have large batteries and the components that make up the majority of their value are sourced locally. This leads to fears that increased EV prices will work against the transition away from petrol and diesel cars by making EVs uncompetitive overnight and effectively incentivising the sale of fossil-fuelled models.

Car makers on both sides of the channel are lobbying hard against the imposition of tariffs in January, instead calling for a three-year delay to the new rules giving time for new battery ‘gigafactories’ to come on stream here in the UK and in Europe.

“Our manufacturers have shown incredible resilience amid multiple challenges in recent years, but unnecessary, unworkable and ill-timed rules of origin will only serve to set back the recovery and disincentivise the very vehicles we want to sell,” says SMMT (Society of Motor Manufacturers and Traders) chief executive Mike Hawes. “Not only would consumers be out of pocket, but the industrial competitiveness of the UK and continental industries would be undermined. A three-year delay is a simple, common-sense solution which must be agreed urgently.”

Want the latest car news in your inbox? Sign up to the free Auto Express email newsletter...

Skip advert
Advertisement
Current affairs and features editor

Chris covers all aspects of motoring life for Auto Express. Over a long career he has contributed news and car reviews to brands such as Autocar, WhatCar?, PistonHeads, Goodwood and The Motor Trader.

Skip advert
Advertisement

Recommended

Car washes targeted by Rwanda scheme staff reassigned to combat illegal workers
Man cleaning a BMW
News

Car washes targeted by Rwanda scheme staff reassigned to combat illegal workers

As many as 1,000 Immigration Enforcement staff will now focus on tackling businesses exploiting illegal foreign labour
22 Jul 2024
M25 closures 2024: No full weekend closures until 2025 but motorway to shut through autumn
Map displaying the closed stretch of M25 between J10 and J11
News

M25 closures 2024: No full weekend closures until 2025 but motorway to shut through autumn

The M25 is open after a series of three full weekend closures this year, but drivers should prepare for more disruption as more shorter closures are s…
20 Jul 2024
1 in 5 new cars sold globally is a Chinese EV but Europe’s electric car appetite is questioned
MG4 - front
News

1 in 5 new cars sold globally is a Chinese EV but Europe’s electric car appetite is questioned

New data shows that EV market share in Europe fell by 0.3 per cent in the first half of this year, despite the car market heading towards pre-pandemic…
19 Jul 2024
Ghost charging? Cable spaghetti? Half of EV drivers admit to poor etiquette at charge points
Fiat 500 connected to a Gridserve rapid charger
News

Ghost charging? Cable spaghetti? Half of EV drivers admit to poor etiquette at charge points

“Ghost charging” is named as biggest bugbear as EV drivers show a lack of consideration for others
18 Jul 2024

Most Popular

New Kia Sportage facelift caught on camera at the Nurburgring
Kia Sportage facelift spyshot 1
News

New Kia Sportage facelift caught on camera at the Nurburgring

Kia’s big-selling mid-size SUV is about to get a makeover for 2025
19 Jul 2024
New Volkswagen Golf 2024 facelift review: updates are a step in the right direction
Volkswagen Golf facelift 2024 UK - front
Road tests

New Volkswagen Golf 2024 facelift review: updates are a step in the right direction

The Volkswagen Golf has been updated to keep it competitive against the likes of the Skoda Octavia and Honda Civic
19 Jul 2024
The arrival of sub-£20k electric cars can't come soon enough
Opinion - Citroen e-C3
Opinion

The arrival of sub-£20k electric cars can't come soon enough

Mike Rutherford thinks that pure electric cars are still struggling to win over the hearts and minds of buyers
21 Jul 2024