Government axes electric car grant in pivot to funding charging infrastructure

Buyers will no longer get a £1500 discount off the price of electric cars under £32,000 as the Government ends the plug-in car grant – but if you've ordered a car already it should still apply...

MG 5 charger

The Government has axed the Plug-in Car Grant (PiCG), so buyers can no longer save £1500 off the purchase price of electric cars costing less than £32,000. 

It announced today that new applications for the grant will no longer be accepted. If you ordered a new car before this morning's announcement and the dealership you're buying it from has applied for the electric car grant, you are still entitled to get it.

The grant – designed to encourage people to switch from petrol or diesel motoring to electric cars – has been reduced several times in recent years.

The most recent grant cut was in December 2021, when it was reduced from £2500 to £1500. At the same time, it changed the eligibility criteria for the grant: it was previously open to electric cars costing up to £35,000, but that was reduced to £32,000. That disqualified popular models including the Skoda Enyaq iV electric SUV, limiting grant users to cheaper models such as the Renault Zoe and MG 5.

The Government credited the PiCG with helping to grow electric car sales from less than 1000 in the entirety of 2011 – the first year it was available – to almost 100,000 between January and May 2022. Sales of electric cars have risen by 70% in the past year, and they now account for one in six cars leaving dealerships.

Skoda Enyaq front

Transport Minister Trudy Harrison said the Government would now “use plug-in grants to match that success across other vehicle types” such as electric motorcycles, taxis and vans, plus others.

However, the National Franchised Dealers Association (NFDA), which represents car dealers across the UK, has hit back at the decision. The group’s Chief Executive Sue Robinson said the axing of the grant “has the potential to derail the positive progress the automotive sector has made towards decarbonising transport”.

With the money saved from the grant, the Government says it aims to grow the UK’s public charging network, having already promised the installation of 300,000 charge points by 2030. According to the charger-tracking app Zap Map, there are currently 32,312 charge points across 19,945 locations in the UK.

In April 2022, the Government announced that it would require car brands to sell an increasing number of electric cars and vans from 2024. The proposals will require 22% of vehicles sold in the UK to be electric from 2024, with the proportion ramping up to 52% by 2028 and 80% by 2030. Sales of conventional petrol and diesel cars will end in 2030, while sales of hybrid cars will end in 2035.

Research conducted by What Car? in April suggested that nearly one in five car buyers was considering an electric car because of the rising cost of fuel and living.

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