Motability Drops Luxury Brands as UK Pushes for British-Built Cars in Major Scheme Shake-Up

Motability, the UK’s long-running vehicle-leasing scheme for disabled people, is undergoing a major overhaul as it removes premium brands such as BMW, Mercedes-Benz, Audi, Lexus, Alfa Romeo, Jaguar and Land Rover from its lineup. The organisation announces sweeping reforms aimed at boosting British manufacturing, improving value for disabled users, and realigning the scheme’s purpose at a time when government scrutiny and public criticism are intensifying. 

The shift comes just days before the budget and amid political debates surrounding PIP growth, tax breaks, and eligibility reforms. Motability stresses that its focus is now squarely on vehicles that meet disabled people’s real mobility needs while supporting the UK automotive sector.

Key Takeaways: Motability Scheme’s Removal of Luxury Cars and Shift Toward UK-Built Vehicles

• Motability removes premium brands such as BMW, Mercedes, Audi, Lexus, and Alfa Romeo immediately, citing the need to prioritise value and purpose for disabled drivers.
  
• The scheme aims for 50% of all leased vehicles to be British-built by 2035, with an interim target of 25% by 2030.
  
• Annual demand is expected to reach 150,000 UK-built vehicles, a major boost for British manufacturers such as Nissan, Toyota, Mini, and Vauxhall.
  
• Critics had raised concerns about luxury cars being subsidised, while supporters argue the scheme enables independence and employment for disabled people.
  
• The government remains silent on potential Motability or PIP eligibility reforms ahead of the budget, pending the ongoing Timms review.
  

Motability Removes Luxury Brands to Refocus on Need-Based Mobility

Motability confirms that premium luxury brands are being removed from the scheme “immediately.”

Cars from BMW, Mercedes-Benz, Audi, Lexus, Alfa Romeo, Jaguar and Land Rover no longer qualify for leasing under the programme.

The organisation clarifies that although customers often paid extra for these vehicles themselves — meaning there was no additional cost to taxpayers — the decision aligns with its renewed priority: supporting disabled people with vehicles that deliver function, value, accessibility, and purpose.

The scheme, which supports around 800,000 disabled drivers, leases roughly 300,000 vehicles each year and includes adaptations, insurance, servicing, breakdown cover, tyre and windscreen repair, and road tax.

Government Signals Support but Avoids Confirming Eligibility Reform

Chancellor Rachel Reeves praises the overhaul, saying the renewed focus on British-built cars aligns with the government’s Modern Industrial Strategy and supports “thousands of well-paid, skilled jobs.” She stresses the reforms will help grow the economy, reduce debt, and ease living costs.

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However, despite political speculation, the government is refusing to confirm whether budget-day changes will affect Motability or PIP mobility eligibility. Any adjustments are likely tied to the Timms review, chaired by minister Stephen Timms, which is investigating the rising PIP bill and issues around eligibility.

Timms previously stated that no eligibility changes for the PIP mobility component will occur until the review concludes next year.

Why the Criticism? Rising PIP Claims and Luxury Car Concerns

The Motability scheme has faced mounting criticism in recent years, particularly over:

• An increase in PIP recipients
  
• A rise in users without visibly apparent disabilities
  
• The availability of premium luxury cars, which some argued misaligned with a taxpayer-supported scheme
  

Motability, however, and disability advocates maintain that the programme enables mobility, independence, and employment for people with disabilities — and that adaptations often make the vehicles critical for daily life.

Motability’s New Direction: Boosting UK Car Production

Motability now sets one of its most ambitious targets in decades: ensuring that half of all cars on the scheme by 2035 are built in Britain.

This strategic move could play a major role in revitalising the domestic auto sector, which has suffered factory closures, declining production, and disruptions such as the recent cyberattack that halted Jaguar Land Rover manufacturing.

If Motability continues leasing approximately 300,000 vehicles per year, the 2035 target translates to 150,000 British-built models annually, up from just 22,000 last year.

Motability Operations CEO Andrew Miller says the decision “opens the door to new investment into UK car manufacturing,” adding:
“Our ambitious commitment should put British car manufacturing into top gear.”

Nissan, Toyota, Mini, and Vauxhall Expected to Benefit

Nissan is set to be one of the earliest beneficiaries.
Motability plans to double the number of UK-built Nissan vehicles it leases — from around 20,000 to 40,000 units.

The Sunderland-built Nissan Juke is already one of the most popular models on the scheme.

Other factories set to gain momentum include:

Motability says it will work “closely with UK-based manufacturers” to increase supply while ensuring affordability and choice for disabled users.

Tax Breaks Under Review but No Final Decision

Reports indicate Chancellor Rachel Reeves has considered reducing or removing tax exemptions for Motability vehicles, particularly VAT and insurance premium tax.

Disability Rights UK warns that removing VAT exemptions could add thousands of pounds to disabled people’s costs and significantly reduce independence.

Motability declines to comment on any upcoming budget measures.

A Defining Shift in the Future of Mobility Support

The reform marks one of the most significant resets of the Motability scheme in decades. By eliminating luxury brands, increasing reliance on British-built vehicles, and aligning the programme more closely with mobility needs, Motability positions itself at the centre of both disability support and UK industrial policy. 

The decisions come during a politically sensitive period marked by rising PIP claims, a major welfare review, and intense scrutiny of public spending. As Motability, the government, and manufacturers move forward, the reforms are set to reshape the landscape of mobility assistance while driving fresh momentum into Britain’s struggling automotive sector.

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