Motor Industry Update 25 March 2021

Plug-in grant for EVs Photo credit: Kia Motors

Changes to the government plug-in car, van and truck grants

Last Thursday’s announcement that the Department for Transport is to reduce the plug-in grant from £3,000 to £2,500 and restrict it to cars with a value of under £35,000 is quite extraordinary given that the UK government wants to stop the sale of new petrol and diesel cars by 2030. This will no doubt have a negative impact on the uptake of electric vehicles to meet government emission targets by 2035.

The biggest barrier to the uptake of EVs is misconception of cost per charge and mileage with research indicating unfounded misconceptions around owning an EV, with 64% of those questioned believing that EVs cost up to £50 to fully charge and more than a third of responders believe that distance per charge was the biggest barrier to uptake.

Education is clearly needed in order to increase uptake in line with the government’s 2035 zero emissions target as the actual low cost of charging the most popular EVs is fact very low, with the Volkswagen e-Golf, for example, coming in at just £6.06 and giving an estimated 121 miles per full charge, while the best performing cars in terms of miles per charge, are the Tesla Model 3 and Jaguar I-PACE, providing an estimated 270 and 250 miles respectively.

SMMT Chief Executive, Mike Hawes said:

“The decision to slash the Plug-in Car Grant and Van and Truck Grant is the wrong move at the wrong time. New battery electric technology is more expensive than conventional engines and incentives are essential in making these vehicles affordable to the customer.

Cutting the grant and eligibility moves the UK even further behind other markets, markets which are increasing their support, making it yet more difficult for the UK to get sufficient supply. This sends the wrong message to the consumer, especially private customers, and to an industry challenged to meet the Government’s ambition to be a world leader in the transition to zero emission mobility.”

While BVRLA Chief Executive Gerry Keaney said:

“Given the surge in battery electric vehicle adoption, it makes sense for the government to reconsider where and how it uses grants and incentives, but today’s move is poorly timed and will slow down the transition to zero emission motoring.

“Confidence in electric vehicles and their running costs is fragile, so slashing the grants and eligibility criteria will put a brake on the fantastic market momentum we have seen in recent months. This will come as a particular blow for the commercial vehicle sector, where BVRLA members have been working so hard to drive uptake of electric vans and trucks. Coming just months before the COP 26 summit and as other countries are increasing their zero emission subsidies, this move could also have a big impact on the supply of electric vehicles coming into the UK.”

And finally, Graham Hoare, Chairman of Ford of Britain sums it up by saying:

“Today’s news from the UK Government that plug-in grants for passenger and commercial vehicle customers are being reduced is disappointing and is not conducive to supporting the zero emissions future we all desire.

“Robust incentives – both purchase and usage incentives – that are consistent over time are essential if we are to encourage consumers to adopt new technologies, not just for all-electrics but other technologies too like PHEVs that pave the way to a zero emissions future.”

More car journeys in future with fewer people using public transport

The impact the last 12 months of restrictions and COVID-19 pandemic has had on our lives has been immense, perhaps none more so than on our travel and transport habits, which has seen a huge decrease in the number of people using public transport with more people choosing to travel alone in their own cars.

Recent independent in-depth research by has discovered that more than half of those surveyed are now less likely to use public transport in the future and when asked if they are more likely to travel by car in the future, two in five said yes.

In fact, one in ten said that they would actually consider buying a new or additional car as a direct result of the last 12 months events.

Harrison Woods, managing director at, said:

“While 2021 promises more hope than 2020, it would appear that COVID-19 will have a considerable impact on how we travel in the future.

“While public transport looks set for a tough time ahead, it looks likely that our roads will soon be back to, or even above, pre-lockdown levels.”

According to the research, roads in the UK look set for a return to being busy in the same way they did in some parts of the country after the first lockdown was eased over last summer, when congestion levels were actually higher than before the lockdown, as many people were less prepared to share their vehicle with other passengers. In fact, four in ten said they are less likely to share a car with others in the future.

Harrison added:

“If Brits flock back to the roads, as this research indicates, then it will be even more important to pre-plan a car journey.

“Consideration should be given as to how long the drive will take, whether toll roads provide a faster alternative and whether there is available parking at the end of the journey, should it be needed.”