It is understood the consultation will explore the possibility of introducing extra “flexibilities” around the rule going forward.
Transport Secretary Heidi Alexander warned the motor industry was suffering from a “lack of certainty and direction” with new rules promising to steer the sector back on track.
She said: “Employing 152,000 people and adding £19 billion to our economy, the UK’s automotive industry is a huge asset to our nation – and the transition to electric is an unprecedented opportunity to attract investment, harness British innovation, and deliver growth for generations to come.
“Yet over the last few years, our automotive industry has been stifled by a lack of certainty and direction. This Government will change that.
“Drivers are already embracing EVs faster than ever, with one in four new cars sold in November electric.
“Today’s measures will help us capitalise on the clean energy transition to support thousands of jobs, make the UK a clean energy superpower, and rebuild Britain.”
According to the Government, the original 2030 ban for petrol and diesel vehicles was “broadly supported by industry”.
However, the ban was pushed back to 2035 by the previous Conservative Prime Minister Rishi Sunak back in September 2023.
More than two-thirds of car manufacturers in the UK have already committed to embracing EVs by 2030 including top firms Nissan and Stellantis.
Jonathan Reynolds, Business and Trade Secretary, said: “There is no route to net zero without backing British industries and workers. There are huge advantages for British industry and we must make sure decarbonisation creates jobs and opportunities.
“We are steadfast in our mission to help our world-leading automotive industry thrive, and this consultation will look at how we can support manufacturers, investors, and the wider industry to reach their targets.
“This Government is backing the auto sector with £2 billion to support our domestic manufacturers to transition to zero-emission vehicles and over £300 million to drive consumer uptake.”