Britain offers discounts on EVs to boost demand
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A Renault electric car on display at a home energy and electric vehicle show in London in April.
PHOTO: REUTERS
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LONDON – The British government will offer discounts worth up to £3,750 (S$6,460) to buyers of electric cars priced at £37,000 or below, it said on July 14, under a new scheme that aims to better align consumer demand with net-zero emissions targets.
The government will spend £650 million on the discount scheme, which will be available from July 16 to consumers once carmakers sign up for the scheme.
As part of a wider goal of achieving net-zero greenhouse gas emissions by 2050, Britain wants to phase out sales of new petrol and diesel cars by 2030. But demand for electric vehicles (EVs) has stalled, with consumers citing high upfront costs as the main barrier.
“This EV grant will not only allow people to keep more of their hard-earned money – it’ll help our automotive sector seize one of the biggest opportunities of the 21st century,” said Transport Secretary Heidi Alexander.
The scheme follows calls from the automotive industry for EV incentives, as carmakers effectively need to sell more EVs each year to meet emissions targets, or pay fines.
Britain scrapped a previous incentive scheme for electric vehicle purchases in 2022 as the then Conservative government shifted focus to spending on expanding the public charging network.
A number of European countries including Norway – which has the highest percentage of electric cars in Europe – as well as France and Germany offer incentives for EV buyers, including subsidies and exemption from taxes.
The British government in April relaxed some of the EV sales targets for carmakers, as the industry coped with new tariffs on sales to the US, its second-largest market after the European Union.
Ms Ginny Buckley, chief executive of advice website Electrifying.com, said nearly one in two electric models will be cheaper thanks to the “long overdue” incentives.
The government said the £650 million funding for the Electric Car Grant will be available until 2028/29.
By contrast, carmakers had spent around £6.5 billion on electric car discounts since the government’s EV sales targets were introduced at the start of 2024, Society of Motor Manufacturers and Traders chief executive Mike Hawes told reporters in June.
Mr Hawes welcomed the new grant on July 14, saying it was a “clear signal” that now was the time for drivers to switch to an electric car. REUTERS
