EU's 'Made in EU' Rules Could Sideline UK Cars From Corporate Fleets
Brussels' proposed Industrial Accelerator Act would require 70% EU-made content for EV subsidies — a rule that trade groups warn could cut the UK off from its biggest automotive market.
The European Commission’s proposed “Made in EU” rules — part of the Industrial Accelerator Act unveiled in early March — are drawing sharp criticism from the UK automotive industry, with the Society of Motor Manufacturers and Traders (SMMT) warning the rules could deal a £70 billion blow to British car exports.
Under the draft rules, electric vehicles would need 70% of their component value to be sourced within the EU to qualify for certain state subsidies and public procurement contracts. The threshold is designed to ensure EV subsidies support European manufacturing rather than Chinese-assembled vehicles — a growing concern as BYD, Geely, and SAIC expand their presence in European markets.
The Corporate Fleet Problem
The most immediate impact, according to the SMMT, would be on corporate fleet sales. Fleet buyers — businesses purchasing vehicles for company fleets — account for more than 60 percent of new car registrations in the UK. Corporate fleet contracts are typically negotiated on a pan-European basis, meaning a car made in the UK must meet EU content thresholds to qualify for inclusion in those tenders.
Under the current draft, UK-built vehicles would be excluded from those contracts unless they can meet the 70% EU content threshold — a tall order given that many UK-built cars use components sourced from the broader UK supply chain.
“The corporate fleet market is the lifeblood of European automotive manufacturing,” an SMMT spokesperson said. “If UK-built cars can’t qualify for those contracts, the impact on our industry would be severe and immediate.”
What’s Driving the Rules
The EU’s push for local content requirements is partly a response to the flood of Chinese EVs entering the European market at highly competitive prices. Chinese manufacturers like BYD, SAIC, and Geely have made significant inroads in Europe over the past two years, and the Commission is under pressure to protect European jobs and manufacturing capacity.
The Industrial Accelerator Act also aims to accelerate the deployment of European battery supply chains, reducing dependence on Chinese-manufactured cells. Battery packs are among the most expensive components in an EV, and meeting a 70% EU content threshold without a strong domestic battery industry is a significant challenge.
Timeline and Opposition
The draft legislation was presented in early March 2026 and is currently working through the EU legislative process. Trade groups from multiple countries — not just the UK — have raised concerns, arguing that the rules could backfire by raising vehicle prices and slowing EV adoption at a critical juncture.
Several member states with large automotive industries, including Germany and France, have also expressed reservations about the potential impact on their own export markets. Negotiations over the final text are expected to be contentious.
For now, UK automakers are watching closely. The UK government has its own post-Brexit EV support policies and is not bound by the EU’s Industrial Accelerator Act — but if the rules effectively exclude UK cars from EU fleet contracts, the damage to British manufacturing could be significant regardless.
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