Government rules out new EV grants

The government has resisted industry calls to reintroduced electric car grants to boost stalling car sales among private buyers.

Vehicle manufacturers and industry bodies such as the Society of Motor Manufacturers and Traders have urged the government to provide financial incentives to drive an increase in sales.

However, it has said it will not restore the plug-in car grant (PiCG), which was launched in 2011 and offered up to £5,000 off the purchase of all plug-in cars. The grant was subsequently reduced to £1,500 and applied to only certain models.

It said: “Government grants have been in place for over a decade to help reduce the up-front purchase price of new EVs. All government grants are kept under review to ensure the best value for money for the taxpayer. The plug-in car grant was closed to new orders on 14 June 2022, having injected £1.5bn in taxpayer funding to support the growth of the early electric car market.

“In June 2022, the government published a public evaluation report, which highlighted that the plug-in car grant was vital in building the early market for electric vehicles. It then had less of an effect on demand. The government is targeting its incentives where they have the most impact and deliver the greatest value for money.

“The number of used EVs continues to rapidly increase. Data from the SMMT shows that, in 2023, used EV sales increased by 90.9%, increasing the pool of available vehicles. The government chairs a working group with several stakeholders to ascertain potential barriers to the uptake of used electric vehicles. The government will consider all policy options, to address potential failures in the market.”