Government slashes EV grant a second time in bid to reel in spending
The government has slashed its grant for electric vehicles (EVs) for the second time this year, in a bid to reel in spending as inflation hits a decade-long high.
The grant has been cut from £2,500 to £1,500, while the value of vehicles eligible for the funding assistance has been trimmed down by £3,000 to £32,000.
The move not only “sends the wrong message” to consumers but will hit less affluent motorists who are trying to meet the transition to net zero most, said National Franchised Dealers Association (NFDA) boss Sue Robinson.
“It is extremely disappointing that the government has chosen to reduce the availability of the plug-in grant as this move can derail the progress our sector has made in decarbonising transport,” she added.
The government also announced reductions to the plug-in van grant and the plug-in motorcycle grant rates and eligibility criteria.
Chief executive of the SMMT, Mike Hawes said: “Slashing the grants for electric vehicles once again is a blow to customers looking to make the switch and couldn’t come at a worse time, with inflation at a ten-year high and pandemic-related economic uncertainty looming large.”
It could also leave automotive retailers in the lurch if purchases were made before the grant portal updated, which was temporarily suspended earlier today as the website processed the amended figures.
The Office for Zero Emission Vehicles said: “Government has a responsibility to manage the grant budget and to deliver value for money for taxpayers and as signalled to industry following the March 2021 grant changes, has therefore been unable to provide notice ahead of the grant changes.”
“Once the webpage has been revised to reflect the grant changes, it is the responsibility of manufacturers or their representatives to notify OZEV if listed vehicles should not be eligible,” it said in a statement.
“Orders placed following the update of the webpage for vehicles later found to be priced above the cap will be cancelled. Vehicles eligible for the grant are also being amended on the grant portal”.