EU tariff delay gives UK EV developers early Christmas present

UK EV Image credit: Markopolo / Shutterstock

UK electric vehicle (EV) developers received an early Christmas present from the European Union (EU), which extended tariff-free exports for the technology.

The EU earlier this year intended to implement rules of origin regulations that would enforce a 10% tariff on EVs built in the UK which are exported to the continent.

The original plan would have seen the move, which would add thousands in expenses to British EV firms, come into force from 1 January 2024.

An agreement, however, has been reached to delay the rules of origin regulation enforcement to January 2027, to support the expansion of the alternative energy vehicle market which has faced major disruption since the Covid-19 pandemic.

Mike Hawes, head of the Society of Motor Manufacturers and Traders (SMMT), described the decision as a “win for motorists, the economy and the environment”.

Hawes said: “Maintaining tariff-free trade in EVs will ensure consumers retain the widest and most affordable choice of models, at a time when we need all drivers to make the switch.”

He added that it would also give the “Anglo-European battery industry the critical time it needs to catch up. The measure will help cut carbon, support growth and jobs, and is the right decision for the decarbonisation of road transport”.

The boost comes as UK EV firms face turbulent market conditions. EV company Arrival has been hit with heavy losses and a failed rescue merger, while EV subscription company Onto entered administration in September.