The government scraps the electric car grant with immediate effect
20 June 2022 | Kasia Parda | 5 min read
The government announced that the £1500 plug-in car grant (PiCG) will be removed with immediate effect on 14 June 2022, ending a scheme that began in 2011.
Government ends electric car grant to focus on EV charging network
According to the government, "success in the UK's electric car revolution" is a major reason for the decision, as it has helped surge sales of pure-electric vehicles from 1000 units in 2011 to nearly 100,000 in the first months of 2022 alone. More than 500,000 EVs have been covered by the PiCG since its inception, contributing more than £1.4 billion in total.
Now, the government wants to focus on expanding the public chargepoint network, as well as on electric taxis, vans, trucks, motorcycles, and wheelchair-accessible vehicles.
The EV grant has been on the chopping block for a while
Over the years, repeated cuts to PiCG funding have led to speculation about its end. The government has earlier committed to funding until the 2022/2023 financial year, which implied the end was near.
The PiCG's cancellation comes just months after its maximum amount was reduced from £2500 to £1500 in December 2021, while the maximum car price was lowered from £35,000 to £32,000 - thereby limiting its eligibility to the most affordable electric cars on the market. With manufacturers introducing cheaper entry-level EVs, the number of EVs available below this price point now stands at 24, up from 15 last year.
Government officials said: "The government has always been clear the plug-in car grant was temporary and previously confirmed funding until 2022-23. Successive reductions in the size of the grant, and the number of models it covers, have had little effect on rapidly accelerating sales or on the continuously growing range of models being manufactured. Due to this, the government is now refocusing funding towards the main barriers to the EV transition, including public charging and supporting the purchase of other road vehicles where the switch to electric requires further development."
In place of the car plug-in grant, the government is providing £300 million in incentives for electric taxis, motorcycles, vans, trucks and wheelchair-accessible vehicles. Although the government explained that the shift in focus would allow for increased investment in EV charging infrastructure in the UK, it has not confirmed whether any plans are in place to add to the £1.6bn in funding for EV chargers already announced earlier this year.
Even without the £1500 grant, the government believes electric cars will continue to appeal to buyers due to reduced running costs, zero road tax (VED) and reduced company car tax.
Trudy Harrison, the transport minister, said: "The government continues to invest record amounts in the transition to EVs, with £2.5 billion injected since 2020, and has set the most ambitious phase-out dates for new diesel and petrol sales of any major country. But government funding must always be invested where it has the highest impact if that success story is to continue. Having successfully kickstarted the electric car market, we now want to use plug-in grants to match that success across other vehicle types, from taxis to delivery vans and everything in between, to help make the switch to zero emission travel cheaper and easier."
Has the grant for electric vans changed?
Fortunately, there has been no change to the electric van plug-in grant.
Consumers purchasing or leasing small vans weighing 2.5 tonnes gross vehicle weight (GVW) or less are eligible for a £2,500 EV grant. Larger electric vans with GVW of 2-3.5 tonnes, can still benefit from a £5,000 plug-in van grant.
Customers who already have an electric car on order with us will not be affected by these changes, but new orders will no longer be eligible for the plug-in grant. We do, however, have one Corsa-e with the grant secured in stock! Simply click below to take advantage of this last chance offer before it's gone.
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