Enhancing the UK’s competitiveness could help deliver more than a million British-built zero emission vehicles every year by 2035, according to a new report.

The report sets out key considerations, including the need to support a mass market for zero-emission vehicles

The 25^th Sustainability Report from the Society of Motor Manufacturers and Traders (SMMT) is now out and reveals that direct carbon emissions from vehicle factories halved over the past 25 years – helping position the country as the ideal place to produce the next generation of zero-emission vehicles (ZEVs).

The report shows the amount of CO2 directly emitted in vehicle production more than halved (-54%) compared with 1999 levels – a major milestone achieved through massive industry investment.

At the same time, the amount of energy and water used per vehicle was slashed by 18.0% and 17.7% respectively last year, with usage now 33% and 42% below 1999 levels.

UK manufacturers are also helping cut on-road emissions with record volumes of electrified vehicles leaving factory lines in 2023, as output rose by almost half (48.0%).

Independent analysis suggests that, with the right investment conditions, more than a million ZEVs a year could be rolling off UK factory lines by 2035– exported worldwide and fuelling billions of pounds of domestic economic growth.

With the Labour party manifesto having pledged to accelerate to net zero and support the transition to electric vehicles, the new government is being urged to use the auto industry’s decarbonisation success to the UK’s advantage. But the report stresses the need for collaboration in making the UK more globally competitive, attracting investment, not just in finished vehicle manufacturing but in its supply chains and adjacent sectors.

Key considerations include the need to support a mass UK market for ZEVs, bearing in mind that manufacturers work to locate close to where their products are sold.

The SMMT’s list of seven measures to make sustainability a competitive advantage in the UK also includes a focus on free and fair trade agreements which promote UK-made products globally while ensuring access to critical raw materials.

Mike Hawes, SMMT chief executive, said: “Britain’s automotive sector has been cutting carbon for decades and this new milestone is significant, not just for industry but for the nation’s move to net zero. We look forward to working with the new government to deliver its green growth agenda that puts Britain at the front of the queue for global investment and sustainability leadership. Automotive can be the driving force behind this strategy, reducing carbon emissions still further while growing the economy, improving air quality and delivering new jobs and skills for people across the country.”

SMMT’s list of seven measures to make sustainability a competitive advantage in the UK

• Publishing a green automotive transformation strategy that sets out a holistic, joined-up approach and provides a pathway towards the UK automotive industry’s ultimate sustainability and circularity goals
• Introducing a package of fiscal, tax and regulatory support measures that attract new investment and ensures domestic vehicle producers are globally competitive
• Providing support and guidance to empower a sustainable, transparent UK supply chain
• Mobilising a skilled, diverse, empowered UK workforce
• Developing a UK regulatory ecosystem in partnership with business that is ambitious, deliverable and harmonised with global regulatory requirements and international sustainability objectives
• Ensuring UK sustainability data requirements match the high ambitions of automotive companies operating across global markets
• Maintaining and further supporting access to critical raw materials and cross-border trade, building supply chain resilience to attract investment in zero emission and sustainability technologies