Keir Starmer, leader of the Labour Party, is scheduled to deliver a speech focusing on the challenges faced by the UK car industry due to newly imposed tariffs.

The imposition of a 25% tariff on UK car exports to the United States has intensified calls for government intervention to safeguard the automotive sector.

In his address, Starmer will emphasize the transformative changes occurring in global trade, stating, "Now more than ever UK businesses and working people need a government that steps up, not stands aside.

That means action, not words." He plans to unveil his 'Plan for Change,' aimed at restructuring the economy and supporting the car industry.

A significant aspect of Starmer's proposal involves alterations to the Zero Emission Vehicle (ZEV) Mandate, a framework requiring car manufacturers to transition towards electric vehicle production while phasing out sales of petrol and diesel cars by 2030. Although the 2030 target remains intact, with exemptions for low-volume manufacturers like McLaren and Aston Martin, the new provisions will permit the sale of full hybrid cars until 2035. Additionally, penalties for manufacturers failing to meet ZEV targets will be lessened, and firms will gain increased flexibility in adherence to these guidelines.

The Department for Transport is expected to release more details on these regulatory changes shortly.

Reactions from the automotive sector have been mixed.

While some industry leaders recognize the steps taken by the government, they also express concerns regarding their sufficiency.

Lisa Brankin, managing director of Ford UK, described the announcement as 'a small step in the right direction,' yet insists it lacks the substantial impact necessary to address the significant challenges currently faced by the electric vehicle market.

The Society of Motor Manufacturers and Traders (SMMT) has voiced its apprehensions, with CEO Mike Hawes stating, "We await full details of the regulatory amendments but, given the potentially severe headwinds facing manufacturers following the introduction of US tariffs, greater action will almost certainly be needed to safeguard our industry’s competitiveness." Hawes underscored the urgency for UK-US trade negotiations to progress swiftly, advocating for a comprehensive industrial and trade strategy prioritizing the automotive sector.

Robert Forrester, CEO of Vertu Motors, a prominent car dealership in the UK, also critiqued the announcement, noting that despite the proposed changes, substantial fines related to petrol and diesel car sales continue to pose financial burdens for manufacturers.

He characterized the government’s response as minimal, suggesting that the electric vehicle targets and the financial penalties associated with not meeting them had not been meaningfully adjusted.

In related market developments, the FTSE 100 index has reflected concern regarding the tariff situation, registering a decline of 6% as investors respond to the potential implications for UK businesses.

Today's political agenda includes various events, starting with a press conference by Nigel Farage of the Reform UK party, followed by a lobby briefing from Downing Street.

Starmer’s speech is expected to take place in the early afternoon, and additional discussions will occur, including at 2.30 pm with Angela Rayner, the deputy Prime Minister, addressing members of Parliament.

Later, Transport Secretary Heidi Alexander is scheduled to inform MPs regarding the changes to the Zero Emission Vehicle mandate.