Plug-in car grant cut: drivers rush to take advantage before axe falls

Official figures show just 1,306 EV grants and 2,374 PHEV subsidies are left in Government coffers before grants are cut on 9 November

Drivers are rushing to take advantage of the Government’s grant for plug-in hybrids (PHEVs) and electric cars (EVs) following news the subsidy will be cut.

The Department for Transport (DfT) and the Office for Low Emission Vehicles (OLEV) recently confirmed the £2,500 grant for plug-in hybrids will end on 9 November, with the grant for EVs reducing from £4,500 to £3,500.

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When the cut was announced last week, OLEV confirmed 3,000 Category 1 grants for EVs, and 6,000 Category 2 and 3 subsidies for PHEVs would remain available up to 9 November.

But figures released by OLEV today show just 41 per cent of these grants are left, with 1,306 EV subsidies and 2,374 PHEV discounts remaining available.

While some of those grants may have gone to customers whose orders were already on dealers’ books, OLEV’s figures indicate 5,320 EVs and PHEVs have been ordered in the last five days. That equates to 1,064 PHEVs and EVs being sold each day since the grant cut was announced.

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Compare that to 2017, when Some 120,000 PHEVs and EVs were bought in the UK (equivalent to around 329 PHEVs and EVs per day), and news of the grant cut seems to have led to a threefold increase in demand.

PHEV grant cut: details

On 12 October, the Department for Transport and the Office for Low Emission Vehicles confirmed Category 2 and 3 grants for pluh-in vehicles will end on November 9.

Category 2 cars emit 50g/km of CO2 or less and can officially travel for 10 to 69 miles on battery power alone; Category 3 cars emit between 50 and 75g/km of CO2 and can travel up to 20 miles on battery power alone. Such cars previously received a grant of £2,500, but this will cease next month. 

The demise of Category 1 and 2 grants means PHEVs such as the Audi A3 e-tron and Mitsubishi Outlander PHEV, which were hitherto eligible for the grant, will no longer be so from 9 November.

Category 1 grants will still exist from November 9, but the amount contributed towards their cost by the Government will reduce from £4,500 to £3,500. Cars must be able to travel for 70 miles on battery power alone and emit under 50g/km in order to qualify as a Category 1 car, something no current PHEV can manage.

PHEV grant cut: industry recoils at “astounding” move

The automotive industry was roundly critical of the Government’s decision to axe the grant for PHEVs, and reduce it for EVs. 

Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders (SMMT), said: “given the importance of environmental goals it’s astounding that just three months after publishing its road to zero strategy, government has reduced the incentive that gives consumers most encouragement to invest in ultra low emission vehicles”.

Rob Lindley, managing director of Mitsubishi Motors UK, whose Outlander PHEV is Europe’s best-selling plug-in, said the move was “extremely disappointing”. Jack Cousens, head of roads policy for the AA, said the decision “will simply put more drivers off from buying greener cars, while  Nicholas Lyes, the RAC’s head of roads policy called it a “major blow” for those seeking to switch to PHEVs and EVs. 

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