Government’s plug-in car grant cut from £3,000 to £2,500

The plug-in car grant has been slashed from £3,000 to £2,500 and is now only available on electric cars costing up to £35,000 as the Government focuses incentives on more affordable EVs.

Effective immediately, the move has been made to ‘target less expensive models and reflect a greater range of affordable vehicles available’ according to the Department for Transport (DfT).

The DfT also says that the number of electric vehicles costing under £35,000 has swelled by close to 50 per cent since 2019, meaning that half of the EVs on sale today will still be covered by the grant despite its reduction.

Transport Minister Rachel Maclean said: “We want as many people as possible to be able to make the switch to electric vehicles as we look to reduce our carbon emissions, strive towards our net-zero ambitions and level up right across the UK.

“The increasing choice of new vehicles, growing demand from customers and the rapidly rising number of charge points mean that, while the level of funding remains as high as ever, given soaring demand, we are refocusing our vehicle grants on the more affordable zero emission vehicles – where most consumers will be looking and where taxpayers’ money will make more of a difference.

“We will continue to review the grant as the market grows.”

The Society of Motor Manufacturers and Traders (SMMT) has criticised the move, stating that the decision is the ‘wrong move at the wrong time’.

Mike Hawes, SMMT chief executive, added: “New battery electric technology is more expensive than conventional engines and incentives are essential in making these vehicles affordable to the customer.

Cutting the grant and eligibility moves the UK even further behind other markets, markets which are increasing their support, making it yet more difficult for the UK to get sufficient supply. This sends the wrong message to the consumer, especially private customers, and to an industry challenged to meet the Government’s ambition to be a world leader in the transition to zero emission mobility.”

The plug-in car grant was introduced 10 years ago to help boost the early adoption of electric vehicles and, since 2011, has provided close to £1.3 billion in plug-in vehicle grant funding, according to the DfT. The Government has also introduced a ban on the sale of new petrol and diesel vehicles from 2030, too.