Motoring retailer Halfords has called on the government to rethink its decision to scrap the £1,500 grant for the purchase of new electric cars.
The Department for Transport (DfT) announced on Tuesday it would “refocus” the funding available away from the grant to encourage other road users, including taxis and delivery vans, to make the electric vehicle (EV) transition.
Halfords’ chief executive Graham Stapleton called the decision “a backward step” as it would delay the mass adoption of electric cars.
“Until now, we have been greatly encouraged by the government’s commitment to making the transition to electric cars,” Stapleton said. “However, the sudden and complete removal of the plug-in subsidy is a backward step.
“Now more than ever, we are determined to carry on playing a key role in helping consumers transition to electric forms of transport and call on the government to continue its efforts in this area too.”
The chief executive’s remarks followed Halford’s full year results, which saw the company’s profit increase by 49.8 per cent to £96.9m while revenue went up 6 per cent to £1.37bn.
Despite the positive performance, Halfords told investors that pre-tax profits for FY23 would be between £65m and £75m due to short-term challenges, including market volatility.
Following the news, Halfords’ shares slumped by 22 per cent to 154p.
The retailer was not the only one to lambast the DfT’s decision, as motoring groups questioned the move.
RAC’s head of policy Nicholas Lyes said the company was disappointed with the decision while Alex Hasty, comparethemarket.com’s director, argued that cutting the grant would push people away from buying an EV as families already hit by the cost-of-living crisis consider the upfront costs too significant.