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Plug-In Car Grant - switch your business to electric before the grant run out

 Published 1st June 2021
General Guides  Low Emission Vehicles 

Not for the first time, the Government has warned that the days of the Plug-In Car Grant are numbered, having already introduced a cap on the price of eligible models and reduced the grant in March this year. The latest news comes following a meeting organised by the National Franchised Dealers Association at which representatives of the DfT's Office for Zero Emission Vehicles (OZEV) were present.

OZEV's position is that the plug-in grants were designed to support uptake of ultra-low emission vehicles while the market is at an early stage. The story is that the current funding is to last until 2022/23, although the OZEV representatives hinted that there would be other means of support for drivers switching to zero emission vehicles.

OZEV suggested that supply and demand issues were at play where the grant was concerned, explaining that when demand was low in the early days of the grant, it was easier to make changes to the grant with advance notice. As demand for plug-in vehicles increased, speeding up how quickly available grant money was used, this has become more difficult and when changes were announced at short notice in March last year, demand for plug-in vehicles suddenly spiked. The OZEV representatives said that the “Government has a responsibility to manage the grant budget and to deliver value for money for taxpayers”.

OZEV has stated that it will continue to “keep the plug-in grants under review and all grants are subject to future changes”. The representatives also confirmed they are “unlikely to be able to provide additional notice” given the need to manage the grant budget “on behalf of taxpayers and future grant applicants”.

The OZEV representatives also provided some clarity regarding the definition of the price cap introduced in March. To be eligible for the grants, cars must be priced below £35,000 RRP. It includes, “any non-standard option fitted by the manufacturer or dealer affecting the capacity of the battery, drive train configuration or maximum net power” and does not include, “any non-standard option fitted by the manufacturer or dealer which does not affect the capacity of the battery, drivetrain configuration or maximum net power”.

“Time is clearly running out for the Plug-In Car Grant, with the funding likely to disappear altogether by the end of 2023,” says Rob Marshall, Operations Director at Gateway2Lease . “Customers who are thinking of going electric should make the move sooner rather than later in case further cuts are introduced before the grant disappears altogether.”

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