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Overnight PiCG cut gave businesses and individuals no time to react

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Ashley Barnett, head of consultancy at Lex Autolease

The Government’s £582 million funding commitment until 2023 to support the uptake of plug-in vehicles is an important step along the Road to Zero.

Naturally, we expected policymakers to review the grants available as confidence in electric vehicles (EVs) continues to rise, but the timing of the recent plug-in grant changes caught the industry by surprise and could put the brakes on the momentum gathered in recent months – we won’t see the full impact for around three months.

While the overnight reduction from £50,000 to £35,000 still meant lower range entry-level models from many manufacturers would continue to qualify for a subsidy, the changes did impact vehicles with bigger batteries and longer ranges.

The greatest challenge of the change in subsidy criteria is the fact that it was made with immediate effect, which, although understandable because of the Office for Zero Emission Vehicles’ (OZEV) previous experience resulting in a flood of applications, it has meant that companies/people whose order wasn’t with the manufacturer on the day have lost out.

There would have been a significant number of vehicles in the quote/order process that will now miss out on Government grants, resulting in either cost implications for businesses across the UK or people not progressing with an EV order and opting for alternative technology or holding back the purchase decision.

It has, however, been encouraging to see manufacturers respond positively and promptly to the announcement and review their pricing models.

We’ve already seen Škoda, Hyundai, Peugeot, Vauxhall and Volkswagen change the pricing of their models to meet the revised £35,000 threshold.

Ultimately, the more choice drivers have with longerrange vehicles will help to turn the electrification dial.

Government departments and industry bodies need to continue to work together to maximise the opportunities to encourage EV uptake and reassure manufacturers that the UK is leading the EV charge.

Maybe a regular temperature check on the future of the grant from OZEV would be useful to enable people to plan replacements and enable businesses to adjust systems accordingly.

Now is the time for sustained investment as we accelerate along the Road to Zero.

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