BMW is stalling plans to restart production of electric Minis at its factory in Oxford.
The Cowley plant, an auto-building site since 1913 and the original home of Morris Motors, was bought by the German carmaker 20 years ago.
The future of this iconic manufacturing hub is now in doubt. And a big part of the reason is the over-zealous imposition by Labour of net zero rules originally introduced by the Tories.
BMW has halted a £600m overhaul of Cowley, it emerged last weekend, amid slow demand for electric vehicles (EVs) and the UK’s zero emission vehicle (ZEV) regulations – which are even more punitive than those operating across the European Union.
I’m astonished this move by BMW hasn’t attracted more attention.
It calls into question not only production at Cowley, a site employing well over 3,000 people, but is a moment of truth for mass carmaking in Britain per se – a sector providing upwards of a million jobs, and many more in related industries and activities.
The UK’s switch away from petrol and diesel cars and towards EVs has now descended into chaos.
Carmakers previously happy to take subsidies to facilitate the huge upheaval of shifting from internal combustion engines to battery-powered cars, now bemoan weak consumer demand for EVs and the extremely punitive fines manufacturers face as a result.
Either ministers get beyond virtue-signalling and ease net zero rules, quickly and significantly, or what remains of UK carmaking will be decimated, as production becomes economically unviable and the market is overwhelmed by a flood of heavily subsidised Chinese-made EVs.
UK carmaking is, of course, dominated by foreign companies. Jaguar Land Rover is owned by Tata, Bentley by Volkswagen, Vauxhall by Stellantis and Rolls-Royce by BMW. The top 10 UK carmakers are all foreign-owned.
Yet automotives are still a vital part of British manufacturing and the broader economy, turning over tens of billions of pounds each year, while providing relatively well-paid jobs in parts of the country, such as the the Midlands and North East, where such jobs are scarce.
A sector-wide collapse would be an economic, political and societal catastrophe.
But that’s where we’re heading unless these ZEV rules rapidly change.
British carmaking last year hit its lowest level (outside of lockdown) since 1954 – and the slowdown is continuing.
Just 71,104 vehicles rolled off our production lines in January 2025, down from 82,997 during the same month the previous year, a shocking 14.3pc below what was already a low base.
A major reason is that carmakers endure massive ZEV mandate fines which actively discourage them from producing cars, makes it financially ruinous if they do.
From January 2023, UK carmakers faced fines if 22pc of cars they sold in Britain weren’t fully electric – paying an astonishing £15,000 for every vehicle by which they fell short.
But the reality that EVs are expensive, unreliable and drivers have “range anxiety” – given our patchy and often expensive charging network. EVs also depreciate sharply and the second-hand market is slow.
That’s why, despite large tax breaks on fleet vehicles, just 18.7pc of new vehicles sold last year were EVs, well below the ZEV mandate – with take-up stuck stubbornly below 20pc for several years now.
And since the start of 2025, that ZEV cut-off has ratcheted up 28pc, increasing steadily to 80pc by 2030 and 100pc, outlawing new petrol and diesel cars completely, by 2035.
That’s why UK carmakers are slowing down production of new petrol and diesel cars – because EV sales aren’t yet strong enough to match even a 22pc market share, let alone escalating looming targets in years to come.
That’s why conventional cars are being “rationed”, leading to soaring prices, as low EV sales mean manufacturers can only avoid ruinous fines by curtailing petrol and diesel car production.
Both the UK and EU have a 2035 headline ban, but the UK’s rules are tougher, with a steeper ramp-up of fines, making Britain an increasingly less attractive place to make cars.
Oh – and Labour has a manifesto pledge, popular among trendy urban-voters, viewed with disdain by trade unionists and across our manufacturing heartlands, to bring forward the complete ban by five years to 2030 – where, by the way, it was originally, under equally naive rules implemented under the Tories.
Stellantis recently announced its long-standing Luton plant is closing, in part due to ZEV rules.
Ministers, meanwhile, insist that BMW remains committed to upgrading its electric Mini production facility at Cowley, as does the carmaker itself. Will that happen? I suspect it won’t.
Policymakers in the UK and EU have bet the ranch on EVs. But the market, rather than public sector bureaucrats, should decide which is the best technology. When bureaucrats “pick winners”, it nearly always goes wrong.
The renewable lobby is powerful, as are the companies both building and financing the rollout of the UK’s charging network.
Huge vested interests are at work to maintain an iron grip over the “EVs or bust” narrative, as this insane ZEV mandate comes into force.
This stranglehold needs to be broken – there are other technologies that may well work better, rendering such a cumbersome and costly charging network rollout unnecessary.
Many senior car industry executives believe, for instance, a much better solution lies in the use of hydrogen-hybrids – hydrogen-powered internal combustion engines which charge smaller, lighter batteries that need no plugging in and far less lithium and rare earths.
Heavily subsidised Chinese-made EVs account for 76pc of all EVs sold worldwide. Plus China controls 90pc of global production capacity of the rare earths used in EV batteries.
Why are we unilaterally destroying our car industry on the altar of net zero?
Ministers need to face reality, slacken the rules and give UK-based carmaking at least a fighting chance to adapt.
