Skip advert
Advertisement

Government says ‘no’ to new cash incentives for electric car buyers

A Lords Committee report backing car-makers’ calls for discounts to boost EV sales falls on deaf ears

Parliament

Car makers and parliamentarians calling for a new package of cash incentives to boost affordability of new electric cars have been dismissed by the government. In a newly published response to the recent House of Lords Environment and Climate Committee report into electric cars, the government states it disagrees with the committee’s demand for new targeted grants.

Advertisement - Article continues below

The Lords’ recommendations were published in February 2024, and stated that “the Government should explore targeted grants to incentivise the purchase of EVs with a view of facilitating a list price under an appropriate threshold”. According to the report’s authors on the Parliamentary committee, such a move would stimulate a more affordable market for EVs, support moves towards price parity with internal-combustion vehicles, and could be used to help counteract the trend towards the large and heavy SUVs that have the worst environmental impact.

Those supporting the calls for a new package of incentives to replace the Government’s Plug-in Car Grant that was withdrawn in 2022, include the Society of Motor Manufacturers and Traders. SMMT chief executive Mike Hawes who has repeatedly called for what he recently termed “compelling fiscal incentives” to discount the cost of EVs for private buyers.

In its written response to the Committee published today, the government says it “disagrees with the recommendation” and will continue to focus on incentivising fleet users to choose EVs through the company car tax system. 

“According to industry data, the purchase price premium of an EV – relative to an equivalent internal combustion engine (ICE) vehicle – has dropped from around 50 per cent in 2020 to around 40 per cent in 2023,” the response states. “With battery costs reducing and continued innovation, some external forecasts predict that some EVs could be around the same price to purchase as a petrol or diesel car by the end of the 2020s. The Government is targeting its incentives where they have the most impact and deliver the greatest value for money.”

Baroness Parminter, Chair of the inquiry said: “Whilst we welcome the Government’s acceptance of some of the recommendations in our report, it is particularly disappointing that it is not committing to incentivising the purchase of more EVs.” She also highlighted the government’s rejection of other measures, including the equalising of the VAT differential between public and domestic charging.

“Peers will keep urging the Government to do more, as otherwise the EV revolution is a non-starter”, she said.

Want the latest car news in your inbox? Sign up to the free Auto Express email newsletter...

Skip advert
Advertisement
Current affairs and features editor

Chris covers all aspects of motoring life for Auto Express. Over a long career he has contributed news and car reviews to brands such as Autocar, WhatCar?, PistonHeads, Goodwood and The Motor Trader.

Skip advert
Advertisement

Recommended

UK self-driving car “revolution” incoming: new law allows autonomous vehicles by 2026
Tesla Model Y - interior
News

UK self-driving car “revolution” incoming: new law allows autonomous vehicles by 2026

A new law is set to bring self-driving cars to UK roads in two years and puts responsibility in the hands of manufacturers if there is an accident
20 May 2024
New EV grant brings £5k electric car discount… but only if you’re an Uber driver
Electric car hooked up to chargepoint
News

New EV grant brings £5k electric car discount… but only if you’re an Uber driver

Uber drivers in London can now save up to £22,000 off the price of a new EV as part of the firm’s push for electrification
20 May 2024
Cheap EV charging comes to public chargepoints via new ‘Plunge Pricing’ app
Octopus Energy’s Electroverse
News

Cheap EV charging comes to public chargepoints via new ‘Plunge Pricing’ app

Octopus’ ‘Plunge Pricing’ events promise to save electric car drivers an average of £6.50 per charge
17 May 2024
UK faces “epidemic” of young uninsured drivers
Car crash
News

UK faces “epidemic” of young uninsured drivers

The number of young people convicted of driving without insurance has tripled since 2021, due to sky-rocketing premiums
17 May 2024

Most Popular

Cheap EV charging comes to public chargepoints via new ‘Plunge Pricing’ app
Octopus Energy’s Electroverse
News

Cheap EV charging comes to public chargepoints via new ‘Plunge Pricing’ app

Octopus’ ‘Plunge Pricing’ events promise to save electric car drivers an average of £6.50 per charge
17 May 2024
Skoda Scala vs Citroen C4 2024 twin test: which is the best-value family hatchback?
Skoda Scala and Citroen C4 - front tracking
Car group tests

Skoda Scala vs Citroen C4 2024 twin test: which is the best-value family hatchback?

The revised Skoda Scala takes on Citroen’s C4 in the battle to be the best-value family hatchback
18 May 2024
Car Deal of the Day: Vauxhall Astra Sports Tourer Electric at an unbeatable £201 a month
Vauxhall Astra Sports Tourer front cornering
News

Car Deal of the Day: Vauxhall Astra Sports Tourer Electric at an unbeatable £201 a month

Our Deal of the Day selection for 18 May will appeal to those who want an all-electric family car that’s not a SUV
18 May 2024