The government has been providing grants for ultra-low emission vehicles since 2011, changing to focus on grants for zero-emission vehicles since 2018. Government figures show that grant funding has supported the purchase of more than 200,000 ultra-low emission vehicles (of which more than 100,000 were zero emission vehicles). 

In March 2020, somewhat understandably overshadowed by recent events, the government announced the continuation of funding for a number of schemes aimed at offsetting the initial and ongoing costs of purchasing an electric vehicle. At the same time, the government also announced a restructuring to the way in which the funding would be made available, which impacts on the amount an individual can receive by way of grant funding when purchasing an EV. The headlines are:

  • grant funding available for the purchase of a new electric car has decreased from £3,500 to £3,000 with no grant funding available for the purchase of electric cars over £50,000; and
  • the grant for the purchase and installation of an at-home or at-work charging point has dropped from £500 to £350.

Whilst the justification for the reduction in grants available to individual purchasers of EVs seems to be that grants will be available for more buyers in general, the experience of countries such as Norway (the global leader in EV transition with EVs approaching 70% market share of new car sales) show that generous government-backed financial incentives play a major role in the growth in the EV market in those countries. Equally, cutting incentives is unlikely to act as a stimulus that the automotive sector will be badly in need of post Covid-19.