A couple of days ago, the UK Government had announced changes to their Plug-in Car Grant. For the past 7 years the Plug-in Car Grant (PICG) had provided a discount to 160,000 ultra-low emission cars. However the government has shifted its priorities with the grant.
In the eyes of the UK government, the plug-in market has been well established due to Plug-In Car Grant. As such, they are now shifting their attention to pure electric and hydrogen cell cars. From the gov.uk announcement:
The changes to the grant announced today will mean that the grant rate for Category 1 vehicles will move from £4,500 to £3,500 and Category 2 and 3 vehicles will no longer be eligible for the grant.
For those not familiar with the different categories, they are as follows:
- Category 1 – CO₂ emissions of less than 50g/km and a zero emission range of at least 70 miles
- Category 2 – CO₂ emissions of less than 50g/km and a zero emission range between 10 and 69 miles
- Category 3 – CO₂ emissions of 50 to 75g/km and a zero emission range of at least 20 miles
Theoretically, this doesn’t necessarily mean that a plug-in will not be able to receive the grant. All-electric ranges for plug-ins are rising as the years go on, like the planned GLE plug-in that is looking to get 62 miles of range. Emissions shouldn’t be to big of an issue either, as something like the Chevrolet Bolt emits 51 grams per mile.
This change to the grant is coming only months after their Road to Zero plan, which will have the UK gas-free by 2040. The fast changing policies have been butting heads with people in the industry, who view the change as sudden.
Mike Hawes, chief executive of the SMMT motor manufacturers body, was not in agreement with the change:
“Prematurely removing up-front purchase grants can have a devastating impact on demand – without world-class incentives, government’s world-class ambitions will not be delivered,”
Jack Cousens, head of roads policy for the AA was also critical of the change:
“The government wants to end the sale of petrol and diesel cars, but scrapping grants for low emission cars may well stall their progress.
“This announcement will simply put more drivers off from buying greener cars.”
Perhaps the government has been overzealous in their change to the Plug-In Car Grant. Sure a fully battery electric is better than a plug-in. But a plug-in is still better than a regular gas-powered car. With the change to the grant, it may sway people who weren’t comfortable with battery electrics and were considering to go the plug-in route, to instead stay with their gas-powered cars.
Not only is it detrimental to the plug-in market in the UK, but this change also hurts battery electrics due to the discount being slashed for them as well. If the government truly intended to push for zero-emission cars, then they would have kept the previous discount and possibly even added on to it due to cutting it for plug-ins. So many car companies have yet to release their electric cars. It will be a fairly long time before producing an electric car will be cost-effective. Hell, according to BMW they will never be cheaper to make than gas-powered cars.
Unless the UK plans to bring out a Zero Emissions Car Grant, then this is premature. It is way to early to start cutting incentives as automakers are just finally starting to release their electric cars. But knows, maybe it will do its job and push people towards buying full electric cars.
The policy change will take place on November 9th. But if sales pick up, the government will enact the change even sooner. (So…be really really quick if you want the discount)
What do you guys think? Let us know down in the comments below