Just as motorists are being urged to switch to eco-friendly electric vehicles, ministers have cut the plug-in car grant designed to make them more affordable – and it could be part of a long-term plan to rescind EV incentives entirely
Four in five motorists think electric cars are still too expensive for them to purchase.
That’s according to a comprehensive survey of more than 15,500 drivers conducted by the AA last month.
The damning verdict comes in the wake of the Government’s recent decision to slash grants designed to make these battery-powered vehicles more affordable.
In March, transport ministers announced that the Plug-in Car Grant – an incentive launched a decade ago to subsidise the cost of pricey electric models – has been cut to just £2,500, trimming the value of the scheme by £500.
But more importantly, ministers also moved the goalposts for eligibility. Previously available to buyers of new electric cars with a value of up to £50,000, only models with an on-the-road price below £35,000 now qualify for the scheme.
It means cars from premium brands like Tesla, Audi and BMW are now further out of reach for the 81 per cent of drivers who told the AA they already couldn’t afford them, but also restricts the scheme to – in many cases – EVs that use older technology, meaning longer charge times and shorter ranges.
Ford of Britain chairman Graham Hoare said the decision – which means the brand’s new Mach-E electric SUV isn’t eligible for the grant – was ‘disappointing’ and ‘not conducive to supporting the zero emissions future we all desire’.
RAC head of roads policy, Nicholas Lyes, had an equally scathing assessment of the Government’s actions, saying ministers like to ‘talk-the-talk when it comes to encouraging people into cleaner vehicles, but cutting the grant certainly isn’t walking the walk’.
Mike Hawes, chief executive at the Society of Motor Manufacturers and Traders, described the decision as the ‘wrong move at the wrong time’.
‘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,’ he added.
Norway is proof that EV incentives can dramatically accelerate the switch to greener cars
The UK Government’s decision is contrary to benefit-driven strategies in other countries that have seen electric car sales surge in recent years.
For example, Norway’s EV-buying incentives include exemptions from all non-recurring vehicle fees, waiving purchase taxes and VAT of 25 per cent, bringing price parity with conventional motors with internal combustion engines.
And such generous schemes have a proven impact on demand, with 54 per cent of all cars registered in Norway in 2020 being electric models.
In contrast, with battery electric vehicles accounting for just 6.6 per cent of all UK registrations in the same year, minsters have already set out plans to scale back existing tax-payer funded offers.
The 2018 Road to Zero strategy – in which government first earmarked a deadline for a ban on sales of new petrol and diesel cars (at the time set at 2040 before being fast-tracked by a decade to 2030 by Boris Johnson) – outlined the intention to wind up incentives as EVs became more mainstream.
The report stated that MPs ‘expect to deliver a managed exit from grants in due course’, promising to support the uptake of ultra-low-emission vehicles ‘through other measures’.
Read more: inews