Surprise change to plug-in grant rates and eligibility criteria for electric vehicles

The Government has announced immediate changes to plug-in car grant rates.

The Government has announced immediate changes to plug-in car grant rates. - Credit: PA

The Government has announced immediate changes which will reduce the amount of grants payable and will mean fewer vehicles will benefit.

The plug-in car rates will be reduced from 35 per cent of the purchase price, up to a maximum of £3,000.

 The eligibility criteria has also changed from cars having to cost less than £50,000 to having to cost less than £35,000. This is the recommended retail price and includes VAT and delivery fees. 

Plug-in van grant has also been reduced from 20 per cent of purchase price, up to £8,000, to 35 per cent of purchase price up to £3,000 for smaller vans <2.5t GVW and 35 per cent of price up £6,000 for large vans 2.5-3.5t GVW.

Their eligibility has changed from vans which have CO2 emissions of less than 75g/km and can travel 16km (10 miles) without any emissions at all and zero emission vans which can travel at least 60 miles without any emissions at all to 'eligible vans have CO2 emissions of less than 50g/km. Eligible vans and trucks can travel at least 60 miles without any emissions at all'.

This shows the Government does not intend continuing with these payments up to 2030 so if you are changing your car in the near future look at all the options to maximise your savings and minimise cost. 

NFDA chief executive Sue Robinson said the decision to cut the grant is 'extremely disappointing' as it 'risks undermining the progress the UK has been making towards a zero emission market in line with the 2030/2035 deadline set by Government'.

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It has also been disappointing that dealers have not been able to open showrooms in traditionally the motoring industry's busiest month of the year.

But dealers continue to be open online and over the telephone and the service operations are open with full safety processes.

Most dealers are preparing for a full return to work from April 12, if the current progress with the fall of new cases of the virus combined with the continued pace of new vaccinations, continues.

Many customers are reserving their new vehicles to collect when the showrooms reopen so dealers are expecting an extremely busy month.

New commercial vehicles continue to sell well as all businesses hope for improved levels as things improve over the next few months.

There is definitely some pent-up demand in many sectors and the online business is likely to continue.

As hospitality and holiday business gets going, Devon and Cornwall can expect record number of visitors during the summer as travelling abroad becomes less likely with the new wave of coronavirus in many European countries.

Foreign travel will not only be difficult but for many the hassle will simply not be worth it.

All this augers well for businesses in holiday areas so there should be a significant bounce back to help both local business and the Government balance the books.

One thing is certain. This is an opportunity to not just to make a lot of families happy after a long and, for many, a difficult winter in lockdown, but to encourage them to come back to our beautiful part of the world time and time again.

Let’s make sure we are all ready to show our visitors we can look after them as well as anyone and at the same time improve the economy and prosperity of the region. 

I look forward to next week. Keep safe and keep smiling.

Peter Vosper, chairman of the Vospers Group

Peter Vosper, chairman of the Vospers Group - Credit: Vospers Group