Britain Must Choose. Follow the EU or Lead the EV Future

By Dr Andy Palmer CMG. Andy is the former CEO of Aston Martin and COO of Nissan. He is known in the media as the ‘Godfather of EVs’. Today, he is the Co-Founder of CEO of Palmer Energy Technology Ltd (PETL). 

History will not be kind to the European car industry of the 2020s. European OEMs sold their souls, and their IP, to gain access to the hugely profitable Chinese market in the early 2000s. China demanded that access be granted through local production in 50:50 joint ventures, arrangements that eventually gave way to Chinese companies such as BYD, Geely, SAIC and BAIC. Those firms learned the art and science of car making from European partners while concentrating their domestic market on EV, or NEV, technology.

China mastered EV technology and went on to dominate the supply chain. In its home market, EVs became desirable and the Chinese consumer stopped buying Toyotas and Mercedes, turning instead to domestic brands which by around 2020 offered better technology and stronger EV products. By 2025, China was no longer “Treasure Island” for European manufacturers who had been slow to adopt EVs and therefore failed to appeal to Chinese customers.

European legislators were equally slow to move towards EV mandates at home. Oil, gas and automotive lobbies worked to protect their leadership, and their self interest, in internal combustion. Some OEMs were openly sceptical of EVs, preferring to back ICE or hydrogen technologies. Manufacturers became complacent and politicians acted as their puppets. Pressure to decarbonise did build, leading to uneven EV adoption across Europe, but with a general direction of travel towards full EV adoption by 2035, and by 2030 in the UK.

If you want to kill an industry, follow the EU playbook. After years of pursuing an ICE phase-out by 2035, the EU now appears to be choosing the worst possible outcome under pressure from panicked OEMs. A so-called phased approach would require only 90 per cent EV adoption by 2035, while allowing ICE to continue beyond 2040, most likely through synthetic fuels.

This is presented as protecting the industry and giving Western manufacturers time to catch up. In reality, it does the opposite. First, it removes urgency from EV adoption and from the search for genuine areas of leadership. Second, it creates vast manufacturing complexity. Carmakers are forced into compromised vehicles, constrained by CAPEX limits or by platforms that must awkwardly accommodate both ICE and EV technologies.

Meanwhile, Chinese manufacturers will continue to excel in EVs. They will keep advancing the science and addressing weaknesses such as battery energy density and cost. EVs, even without their next generation technologies, already represent a compelling proposition. They are cheaper and more reliable to buy than ICE vehicles, far cheaper to run, enjoyable to drive and potentially CO₂-free in operation. They integrate with infrastructure, becoming not just transport but decentralised energy storage. For light vehicles, EVs are an inevitable solution. Alternatives such as synthetic fuels may find niche applications, but EVs will dominate, and EU legislation will have opened the door to Chinese leadership.

The question, then, is whether the UK will follow the EU, in the irony of net zero opponents taking their lead from Brussels, or whether it will exercise the implied freedom of Brexit. In truth, the UK is likely to feel compelled to align with the EU, in part because it no longer controls its car industry. But an alternative exists, a bold one that will draw criticism from all sides.

That alternative is for the UK to hold its 2030 and 2035 commitments and position itself as a European laboratory for EV adoption. In return for low barriers to entry, it would follow the model of Thatcher’s Britain in the 1980s and China in the 2000s, actively collaborating with China. It would encourage, and where necessary compel, Chinese investment into UK car and battery manufacturing. Today, China does not view the UK as an obvious destination for investment. Repositioned as an EV laboratory, with low barriers to entry and the same advantages that attracted Japanese firms in the 1980s, English law, language and education, that could change.

I advocate for the latter course, while planning for the former. I hope that during the Prime Minister’s forthcoming visit to China, he takes a front-footed approach to bringing Chinese investment into the UK.