Plug-in car grant to return with announcement expected this week

The Government says it will make buying an electric vehicle (EV) cheaper ahead of an expected re-launch of the plug-in car grant (PiCG) scheme.

The electric car grant was scrapped in 2022, under the Conservatives, at which time it was worth up to £1,500 off a new plug-in vehicle.

The Telegraph reports that ministers are expected to announce two new schemes to make it cheaper to buy an electric car, backed by £640 million in funding.

It suggests that grants will be higher for the adoption of UK-manufactured vehicles, in particular, Nissans.

However, while the transport secretary, Heidi Alexander, would not confirm the Government will offer drivers thousands of pounds in grants to cut the price of buying an EV, she did acknowledge that it does intend to make it “cheaper” for motorists to choose an EV.

She told ‘Sunday with Laura Kuenssberg’: “We are going to be making some announcements later this week on how we make it more affordable for people to buy an electric vehicle.”

“We will be making it cheaper for those who do want to make the switch to an electric vehicle,” she added.

The Government announced on Sunday (July 13) a funding package worth £63m to help boost charging infrastructure, with £25m earmarked for people without driveways to have charge points fitted using ‘cross-pavement gullies’.

There was also £30m for a depot charging grant scheme and £8m for charging facilities at 200-plus NHS sites.

The possible return of the plug-in car grant comes as private sales of new EVs have failed to match the levels seen in the fleet sector.

Private battery electric vehicle (BEV) uptake has fallen 10.8% year-to-date, with fewer than one in five new BEVs going to private buyers. 

A coalition of more than 30 companies wrote to Alexander last week, emphasising the need for urgent action to also support the used BEV market.

Coordinated by the British Vehicle Rental and Leasing Association (BVRLA), the open letter was signed by companies spanning vehicle demand and disposal, maintenance and insurance, charging providers and drivers.

They highlight how the used market offers the best value-for-money opportunity for Government to accelerate BEV uptake.

The letter came in the wake of the BVRLA’s annual Road to Zero report, which claimed that the UK’s EV future hangs in the balance, with used values “falling relentlessly”, costing the fleet and leasing sector hundreds of millions of pounds.

The average used EV price has fallen 46% between 2021 and 2024, compared to 19% for cars with an internal combustions engine (ICE).