UK electric vehicle grants reduce (but more will get them)
The UK government is reducing the size of its electric car grants, but says they will be given to more people.
The Department for Transport this week announced that the government grant towards the cost of a new electric car has been reduced from £3000 to £2500.
The grant will now also only apply to vehicles costing under £35,000, whereas previously there had been no limit.
On the face of it, this isn’t great news for people hoping to invest in an electric car in the near future. Petrol and diesel vehicles remain significantly cheaper, and it’s difficult to see how £2500 could tempt people on low and middle incomes to switch to an electric alternative.
However the news may not be all bad.
Total government funding for the grants hasn’t changed, meaning more people will be supported by the same pot of money. This could be important given the increasing popularity of electric vehicles.
Introducing a cap on maximum car values may also put pressure on car manufacturers to reduce their prices and there should still be plenty of choice; the government claims that over half of electric cars on sale cost less than £35,000.
Many would also argue that taxpayers’ money could go to better green causes than subsidising people who can afford to buy high-end £50,000 cars!
Whether its government funding and incentives or an increasing public awareness of their many advantages, it’s clear that electric cars are rising in popularity, moving from 1.6% to 6.6% of all sales between 2019 and 2020.
Let’s hope this trend continues!