The UK automotive industry has warned that the country risks “deindustrialisation” unless the government urgently reviews its electric vehicle transition pathway.
New analysis from the Society of Motor Manufacturers and Traders (SMMT) finds the UK’s EV transition plan was built on overly optimistic assumptions about battery costs, energy prices and infrastructure rollout.
Despite having the highest battery electric vehicle (BEV) market share among major European markets, the UK is already falling short of regulatory expectations.
In 2025 BEVs accounted for 23.4% of new car registrations, below the 28% required under the Zero Emission Vehicle mandate.
The gap could widen significantly by 2027, when EV targets will increase to 52% of car sales and 46% of vans.
SMMT said industry incentives and discounting, which have exceeded £10 billion in the past two years, will become unsustainable as targets accelerate.
Mike Hawes, SMMT chief executive, said: “The UK’s EV transition pathway was conceived with the best of intentions—but the assumptions behind it have proved over-ambitious.”
“A landscape which once looked solid has turned out to be quicksand. Recognising that the world of 2026 is not the one envisaged five years ago is not a retreat from ambition; it is a necessary step to achieving it.”
The report highlights several structural challenges slowing adoption.
Battery costs remain more than 30% higher than expected, while UK industrial energy prices have risen 80% since 2021 and now stand 124% above the EU average.
Charging infrastructure is also lagging behind demand. Chargepoint growth slowed to 19.7% in 2025 and more than two-in-five public chargers are located in London and the South East.
The SMMT is calling for a strategic review of EV regulation, infrastructure deployment and industrial competitiveness to ensure the transition remains achievable.
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