UK’s carbon neutrality: an assessment of the 2030 row back - TechTalent September 23
27 Sept 2023 by Joel Hard

UK’s carbon neutrality: an assessment of the 2030 row back - TechTalent September 23

​Unless you’ve worked hard to avoid recent news, you’ll be aware that Prime Minister Rishi Sunak has rowed back on elements of the UK’s carbon neutrality targets.

Last week he announced that domestic consumers would be able to buy new diesel and petrol vehicles until 2035, a delay of five years on the government’s previous ban on new petrol and diesel car sales. In this newsletter we’ll share a brief, politically-neutral assessment of the news based on our conversations with clients and candidates.

The response from the automotive industry ranges from relaxed to enraged, and may depend on how much skin in the game the various car manufacturers have: some are so far ahead of the curve that it won’t make a difference to them, while others will appreciate the breathing space.

Ford UK has already invested £430m to upgrade its UK plants to produce electric cars, with UK chair Lisa Brankin describing the original 2030 target as “a vital catalyst to accelerate Ford into a cleaner future". She believes the relaxation of the 2030 deadline undermines the “ambition, commitment, and consistency” the brand needs from the government.

The Society of Motor Manufacturers and Traders said the news would send an "incredibly confusing" message to consumers who may now delay their purchase of an electric car, but the mood is mixed: Toyota welcomed the government's announcement, while JLR (Jaguar Land Rover) said the move was "pragmatic”.

Who does the delay protect, and for how long?

The Prime Minister has suggested that the cost of EV adoption for consumers is a key driver for the delay, saying it is “not right to impose more costs on working people.” EVs are undeniably pricey. The average cost of a new petrol car is about £39,000, rising to about £50,000 for an electric one; not easy to swallow in a cost of living crisis.

And while the cost of electric vehicles has long been a barrier for consumers, so has a lack of infrastructure. A five-year delay could present an opportunity for mobility and charging projects to win more investment, with a bigger window to lay foundations that could facilitate widespread market adoption in slower time, which may yet be kinder to the consumer.

A blow to investment?

However, the biggest risk to the automotive industry is that the delay could damage investment into it. The reality of innovation markets is that the more investment they can attract, the greater their emphasis on technological research and development. This is how cost-reduction is accelerated for consumers in the long term, and the risk now is that investment will slow or stop in certain pockets of the market.

Many brands were years into R&D, manufacture and strategising to meet the 2030 targets. Investors expect to see a return, and when one market stalls, other, more progressive ones will become a new target for investors. Funding may be redirected to other markets or other countries, and with that investment will go the forces that make technology more affordable. If the new 2035 deadline does indeed present a new window of opportunity to improve our infrastructure, then government and industry are going to have to work together to woo investors.

A matter of perspective?

Is Rishi Sunak kicking the can down the road, slowing the process of total market adoption? It’s hard not to see this impacting consumer adoption in the short term, but the process is subtle. It’s not just about mandates and deadlines, and buyer behaviour is not purely economically-driven. It is also social and cultural (which is probably why the SMMT fears consumer confusion).

Last month we talked about the volatility and uncertainty of markets, and the Prime Minister has inarguably forced a rapid adjustment onto manufacturers that had invested millions or billions to meet the 2030 targets. But despite this there is a core of manufacturers, consumers and lobbyists who will continue to drive change. The impact on manufacturers will likely depend on whether their EV strategies so far have been a matter of necessity or choice. Developments in mobility have been driven by people who want to be the change they want to see. Many of our clients will not swerve from their planned course.

What caught our attention this month

Three-quarters of crops grown around the world to produce fruits or seeds for human consumption are reliant, in part, on pollinators. But mechanical pollination may be increasingly needed as bee populations struggle.

We can’t help but be fascinated by the sheer madness of the Tesla Cybertruck, and drone footage may have captured images of “Master Candidate” vehicles outside the brand’s Texas Gigafactory.

We’re all for anything that introduces more people into science and technology, so how about this range of coding courses from LinkedIn that are free until December 18th?

What’s next?

If the government’s announcement about 2030 has affected your hiring or job search plans in any way, feel free to get in touch with us to see if we can help.


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