The UK automotive sector is at a pivotal juncture as it navigates towards a era dominated by EVs (EVs). The Zero Emission Vehicle mandate, starting in 2024, requires 22% of all sedans sold to be ZEVs, with ten percent for light commercial vehicles. This legal push is anticipated to significantly boost the presence of BEVs (BEVs), in spite of current difficulties such as high production costs and low profit margins for makers (Grant Thornton UK LLP) (EY).
Nonetheless, the market is not without its challenges. Sales of automotive BEVs have lately experienced a decline, in part due to the upcoming regulations and the economic strain they impose on makers. Companies are embracing approaches like giga casting to cut manufacturing costs. Giga casting, previously used by Tesla and several Chinese manufacturers, eases the manufacturing process by molding major portions of the car, which decreases both complexity and costs (Grant Thornton).
Despite these improvements, the sector faces a precarious equilibrium. Higher price increases and borrowing costs, alongside changing battery tech and potential duty changes on non-EU BEVs, cause market volatility. Nonetheless, the adherence to green energy and creative production methods provides a hopeful prospect for the UK's automotive future as it shifts to a more sustainable model (Grant Thornton) (EY US).