In a decisive move to reverse the decline of the domestic automotive sector, the Motability scheme has pledged to drastically increase its intake of UK-manufactured vehicles. The organization, which manages the leasing of cars to disabled people using their mobility allowances, has set a hard target: by 2035, half of all vehicles it offers must be built in British factories. This ambitious goal implies that the scheme will eventually lease around 150,000 British cars every year, a massive jump from the 22,000 recorded in the previous year. To pave the way for this transition, Motability is stripping its fleet of expensive foreign imports, specifically dropping premium German marques like BMW and Mercedes-Benz effective immediately.
The sheer scale of the Motability scheme makes this policy shift a potential game-changer for the UK economy. With a fleet of over 600,000 cars and annual leases of around 300,000, Motability is the largest fleet operator in the country. Redirecting this purchasing power is a strategic move supported by Chancellor Rachel Reeves, who sees it as a method to “support thousands of well-paid, skilled jobs” without directly increasing government spending. The logic is straightforward: by ensuring that the money flowing through the scheme—subsidized by VAT and insurance tax exemptions—is spent on British products, the government can stimulate industrial output. This is particularly critical given the recent struggles of the car industry, which has seen production slump due to cyber-attacks on Jaguar Land Rover and broader global economic headwinds.
The decision to remove premium cars has sparked some discussion regarding consumer choice. Previously, disabled drivers could access these luxury vehicles by paying the price difference from their own funds, meaning the taxpayer incurred no extra cost. However, these vehicles represented only about 5% of the scheme’s total volume. By removing them, Motability Operations is streamlining its focus toward “value and purpose,” prioritizing vehicles that are practical and cost-effective. This shift is also a preemptive measure to protect the scheme’s financial standing, as Reeves has scrutinized the tax breaks it receives. Disability Rights UK has warned that removing these tax breaks would be disastrous for users, so aligning the scheme with national economic interests may be a way to safeguard its future.
For manufacturers like Nissan and Toyota, this announcement is akin to a guaranteed order book. Nissan’s plant in Sunderland and Toyota’s facility in Burnaston are expected to absorb the bulk of this redirected demand. Nissan executives have already projected that the number of their cars bought by Motability will double, providing a bedrock of stability for the workforce. The situation also presents a unique opportunity for the Mini plant in Oxford. While its parent company BMW is losing access to the scheme for its main brand, the Mini remains a strong contender. The new policy creates a powerful financial argument for BMW to unfreeze investments and commit to building future electric Mini models in the UK, ensuring they qualify for the scheme.
Andrew Miller, Chief Executive of Motability Operations, described the plan as an “ambitious commitment” designed to put British car manufacturing into “top gear.” He highlighted the collaborative nature of the initiative, working alongside the government and the automotive sector to drive economic growth. The message is clear: the Motability scheme is no longer just a social service; it is a strategic asset in the UK’s industrial policy. By converting the mobility needs of the disabled population into a consistent demand for domestic manufacturing, the scheme aims to secure a future where British factories remain open, active, and profitable.