Audi has blamed Chancellor Gordon Brown's Budget as one reason not to sell the A2 1.2-litre turbodiesel in the UK. The company is demanding financial incentives to encourage British drivers to use more fuel-efficient cars with lower emissions.

The A2 1.2TDi is important because, according to Audi, it is the first production model to achieve 100mpg (100km/62miles on three litres) and 100mph. The1.2TDi uses specially-developed bodyparts and is 135kg lighter than the 1.4Tdi.

Dr Werner Mischke, a member of the Audi management board, speaking at the international launch of the model, criticised Mr Brown, deputy prime minister John Prescott and his transport minister, Lord Macdonald, for their lack of initiative.

“In Germany the new 1.2TDi qualifies for the equivalent of a £500 tax bonus,” Dr Mischke said. “That doesn't happen in the UK. The UK Government needs a complete change in policy and understanding before the environmental issue is taken seriously in terms of the automotive industry.

“I had hoped Gordon Brown would use the Budget to introduce some form of incentive.”

Dr Mischke thought Germans buying the 1.2 turbodiesel would be making a statement about their environmental responsibility. “In the UK, car buyers don't consider the environment an issue,” he said.

“All they want is performance and image. Green issues do not come into the equation. That's why we won't bother selling the car in Britain. The people who head the transport division in the British Government – Lord Macdonald and John Prescott – really should get their act in order.”