The most damaging motoring Budget in decades has landed. And after a few days to think, the whole thing looks even worse
If you thought Pay-Per-Mile was “fair” or “inevitable”, you’re missing the biggest automotive disaster heading straight for Britain. I’ve had a few days to calm down after the Chancellor dropped the motoring equivalent of a tactical nuke into the nation’s glovebox with the Autumn 2025 Budget. But I haven’t calmed down. I’ve got angrier, more frustrated, and more convinced this Budget could cripple the UK car industry, humiliate disabled drivers, and utterly suffocate car culture. This isn’t a minor tweak. This is the start of a crisis.
The Real Danger Isn’t Just the Money – It’s the Psychology
People keep saying this new pay-per-mile system is fair or inevitable, that EV drivers have been living in a tax-free nirvana and should now pay their share. It’s the sort of simplistic take that completely ignores the reality of running an electric car in Britain today. Charging at public points already costs a small fortune, insurance premiums are going through the roof, residual values are collapsing faster than a rusty Datsun, and the infrastructure remains patchy at best. Yet none of that is even the main problem here. The true damage is psychological.
There’s a world of difference between taxing a litre of petrol, which most people absorb without even checking the receipt, or paying your VED once a year and forgetting about it until the renewal reminder lands, compared to installing a running tally on every single metre you drive. Pay-per-mile isn’t just a tax; it’s a constant nudge, a relentless whisper in your ear that movement has a price.
It turns basic mobility into a cost-benefit calculation, and in a cost-of-living crisis where every penny is scrutinised, that does something corrosive to people’s confidence, to their spontaneity, to their sense of freedom. You won’t pop out for a drive to clear your head, you won’t detour for a scenic route, you won’t offer your neighbour a lift to the airport unless you mentally calculate the incremental cost first. It narrows life. It shrinks the country. It undermines the very idea that driving is about more than going from A to B.
PHEVs Dragged In Too – and That’s a Massive Mistake
And then we come to plug-in hybrids, dragged into the net at half the electric rate. PHEVs were supposed to be the sensible stepping stone, the compromise that soothed range anxiety and bought manufacturers time to transition. Instead, they’ve been lumped into a scheme designed without any grasp of nuance or consumer psychology. The OBR already predicts around 440,000 fewer EVs on the road by 2031 because of pay-per-mile. Add PHEVs into the penalty box, and that number is almost certainly an understatement.
Used Values Will Implode – and That Hurts Everybody
This collapse in confidence will hammer used values, and with that comes the predictable domino effect. Leasing firms will become skittish because future valuations suddenly look as unpredictable as British weather. Dealers will stop taking EVs in part-exchange at anything resembling a sensible price. Manufacturers will begin to divert stock elsewhere, because the UK will no longer look like a market capable of supporting their mandated electric transition. Hit ZEV targets? Not a chance. The Government has essentially kneecapped its own environmental targets while pretending the scheme is about fairness and revenue.
Motability Just Got Downgraded to the 1970s
Motability, meanwhile, has found itself thrust into an unexpected and unnecessary storm. The decision to strip out premium brands under the guise of removing ‘luxury’ feels like a retrograde step, reminiscent of those little blue disability vehicles from the 1970s that signalled limitation rather than liberation.
The ironic part is that the Government wasn’t paying for anyone’s Mercedes or BMW – customers who wanted something nicer were already paying the difference themselves. Removing choice serves no fiscal purpose; instead, it chips away at dignity and joy. After all, if someone is navigating the challenges of disability, why shouldn’t they enjoy the sensory uplift of an Alfa V6 burbling to life, or the quiet pride of owning something that makes them feel good every time they turn the key?
Cars aren’t just transport – for many they are confidence, identity, escapism, therapy on four wheels. Taking that away feels needlessly patronising and profoundly out of touch.
The Government Says It’s Supporting the Car Industry – This Budget Does the Opposite
What makes all this even more galling is the Government’s insistence that it wants to support the British automotive industry, which contributes billions to the economy and sustains hundreds of thousands of jobs. Yet this Budget does the very opposite. Motability cuts carve out hundreds of thousands of guaranteed annual sales, pay-per-mile undermines EV adoption at the precise moment manufacturers are legally required to sell more of them, used values will drop through the floor, and private buyers will hunker down with older vehicles.
Petrol models will become more desirable just as supply tightens thanks to ZEV pressures, pushing prices up further. Scrappage schemes have already wiped out thousands of perfectly serviceable older cars, leaving a shrinking pool of affordable options as demand rises. The car parc will age significantly, and that undermines safety, emissions and economic activity all at once.
Who Survives This? Not Who You Think
Legacy manufacturers, already staggering under the weight of global EV slowdowns, won’t see the UK as a viable arena for long. JLR is too premium to save the mainstream market. European marques are being hammered by costs, recalls and slow uptake. American brands are fading from the landscape entirely.
In contrast, Japanese manufacturers – who wisely resisted the full-EV dogma – now look perfectly positioned to ride the hybrid resurgence. China, with its scale, battery dominance and ruthless cost advantage, will fill the vacuum with astonishing speed. And India, an often underestimated contender, is now producing stylish, robust, astonishingly affordable models that could land in Britain under a new trade deal and undercut everyone. The new Tata Sierra under twenty thousand pounds would alter the landscape overnight.
So what we’re left with is the bleak realisation that this Budget hasn’t merely nudged the motoring landscape; it has detonated under it. Dealers, drivers, manufacturers and disabled customers all find themselves caught in the shockwave. The proudly independent culture of British motoring – from Sunday drives to enthusiast communities to the very idea of freedom behind the wheel – has been throttled by a policy that monitors every mile and punishes every journey.
This isn’t levelling the playing field. This is dismantling it.
And unless something changes very soon, the future of British motoring will be shaped not in Coventry or Solihull, but in Shanghai and Pune, while the rest of us cling to ageing hatchbacks and wonder how a nation that once built icons managed to lose the plot so completely.
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