Ford boss: 'Now is not the time to tax electric vehicles'

Taxes on electric vehicles may put drivers off buying them at a time when demand has “lost momentum”, Ford’s UK boss has warned.

It comes after the BBC reported Chancellor Rachel Reeves could be considering new levies on EVs in the upcoming Budget.

Ford UK’s managing director Lisa Brankin told the BBC: “It’s certainly not the right time to do it.”

A Treasury spokesperson said: “Fuel duty covers petrol and diesel, but there’s no equivalent for electric vehicles. We want a fairer system for all drivers.”

The Chancellor has been reported to be considering a new pay-per-mile charge for electric vehicles from 2028.

Ms Brankin told the BBC’s Big Boss Interview podcast: “That [policy], in the face of really fragile demand for electric vehicles, is just another brake.”

The admin task of calculating their mileage would put potential EV owners off making the switch, she says.

“It’s really easy to sell people things they want,” she says. “It’s hard to sell people things they don’t want.

“Electric vehicles in some instances have gone from being a great thing to being something that we’re trying to push people into.”

Ford sells the UK’s most popular vehicle, the Ford Puma, while its commercial van the Transit holds the second-most-sold ranking.

For years its Focus model was the UK’s most-popular, but the US company axed the hatchback and the last Ford Focus rolled off factory lines in Germany last week.

It employs around 6,000 people in the UK, with an engine plant in Dagenham and a transmission factory in Halewood. It hasn’t manufactured a vehicle here since 2013.

Ford like other car makers is under pressure to meet the UK’s net zero plan, 80% of new car sales must be EVs by 2030 or face fines.

The government has reinstated a grant worth up to £3,750 to encourage drivers to buy electric vehicles.

Ford would not be able to reach that 80% target without government help, such as the grant, Ms Brankin said.

Sales figures from car industry body, the Society of Motor Manufacturers and Traders (SMMT) show how far car makers have to go to reach the target.

Fully-electric vehicles made up around 22.4% of total new car sales, data for 2025 up to 31 October shows. This time last year it was 18.1%.

In September, the UK new car market experienced its best performance since 2020, driven by a surge in EV sales which hit a record high, according to SMMT figures.

However, Ms Brankin pointed to heavy discounting across car sales forecourts as well as a lower resale value in the second-hand EV market as indicators that the market was “distorted”.

“When that [target] was set a number of years ago, the outlook for demand around electric vehicles was buoyant and there seemed to be momentum behind electric vehicles. What we’re seeing now is that customer demand is not in line with that ambition,” Ms Brankin said.

A large share of new EVs are sold to businesses for their employees and they benefit from lower rates of “company car tax” compared with diesel or petrol-fuelled options.

Ms Brankin has urged the Chancellor to retain this tax benefit of companies “greening” their vehicle fleets.

The shift to EVs could have consequences for the close-to 1,800 staff at the Ford diesel engine plant in Dagenham, which was the largest car factory in Europe when it was first built.

Ms Brankin said Ford was yet to make any decisions about the future of the plant, which will build diesel engines up until 2030.

“We’re working really hard on and what the next life of Dagenham looks like, ” she said but there was “nothing that we’ve settled on at the moment.”