Skip advert
Advertisement

Cheap electric car finance could be on the cards as government aims to boost sales

A newspaper column and whispers suggest that government-backed cheap EV loans could be coming to stimulate market

Omoda E5 - front tracking

Cheap car finance for EVs could be on the cards as the government scrambles to boost the number of UK electric car sales and appease disgruntled manufacturers amidst anger surrounding the ZEV mandate.

Writing in the Observer on Sunday, Secretary of State for Business and Trade, Jonathan Reynolds, told readers that the government “want[s] to do everything possible to make sure the next generation of zero-emission vehicles (ZEV) are designed and built right here in Britain [and] are affordable and accessible for working people”.

These statements come shortly after Reynolds announced at the Society of Motor Manufacturers and Traders’ (SMMT) annual dinner that Labour was seeking to conduct a review into the controversial ZEV mandate. This requires manufacturers to ensure a fixed and growing proportion of their output comprises electric and other zero-emissions vehicles, lest they receive a hefty fine of as much as £15,000 per car over the annual threshold.

Advertisement - Article continues below

While the business secretary’s words may cast some obscurity over the government’s approach to the current situation, which has seen some car makers announce the closure of UK facilities in order to cut costs, insiders suggest that ministers may be investigating how they could introduce low interest rate loans to the market in order to increase EV uptake.

Skip advert
Advertisement
Skip advert
Advertisement - Article continues below

Reynolds also reiterated his commitment to the manufacturers themselves, stating that “there is no route to net zero without backing British industries and workers”. He also told firms how the £2billion investment from Chancellor of the Exchequer Rachel Reeves in the autumn Budget will “support the latest research and development into these technologies, accelerating their commercial scale up and unlocking capital investment”.

To keep companies afloat while demand for EVs grows, another insider suggestion is that the government is weighing up whether to reduce fines for manufacturers straying over the mandate’s limit, which is set at 22 per cent of output for 2024. However, Reynolds reminded the public of the government’s commitment to the mandate as a whole, saying how the upcoming consultation “is about how, not if we reach this ambition”.

In the meantime, hundreds of jobs lay in the balance after both Ford and Stellantis (the owner of Vauxhall) decided to streamline UK operations in order to cut costs in light of tepid demand for EVs. Nissan, which has previously called on the government for “urgent action”, has also threatened job cuts if returns for investments are not met.

Would you buy an electric car if cheap finance was available? Let us know your thoughts in the comments section...

Skip advert
Advertisement
Consumer reporter

Tom is Auto Express' Consumer reporter, meaning he spends his time investigating the stories that matter to all motorists - enthusiasts or otherwise. An ex-BBC journalist and Multimedia Journalism graduate, Tom previously wrote for partner sites Carbuyer and DrivingElectric and you may also spot him presenting videos for the Auto Express social media channels.

Skip advert
Advertisement

Most Popular

Some Chinese car brands are doomed to disappear, warns Skoda boss
Skoda Kodiaq - front cornering

Some Chinese car brands are doomed to disappear, warns Skoda boss

Skoda’s sales and marketing boss warns “there will be a consolidation” of the number of Chinese car brands around
News
3 Feb 2026
New Kia EV1 electric city car on the way to rival the Renault Twingo
Kia EV1 - front (watermarked)

New Kia EV1 electric city car on the way to rival the Renault Twingo

Kia's design boss lifts the lid on plans for a Renault Twingo and Volkswagen ID. Lupo rival, and our exclusive images preview how the EV1 could look
News
2 Feb 2026
Meet Renault’s new SUV: a Dacia Duster but not as we know it…
Renault Duster - front

Meet Renault’s new SUV: a Dacia Duster but not as we know it…

Posher inside and out and with more headroom, welcome to the upside down world of the Indian Duster
News
26 Jan 2026

Find a car with the experts