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Criticism over changes to plug-in car grant

Monday, May 13, 2019 - 09:24
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Chief Executive of the Society of Motor Manufacturers and Traders (SMMT), Mike Hawes

The Government is being urged to increase financial support for the uptake of green vehicles – despite a rise in the number of new ultra-low and zero emission vehicles registered in the opening third of 2019.

Figures published by the Society of Motor Manufacturers and Traders (SMMT) on 7 May show that 51,091 alternatively fuelled vehicles (AFVs) were registered for the first time between January and April – a year-on-year rise of 14%.

During that period, AFVs accounted for 5.9% of all new registrations – up by 0.9% from the same period in 2018.

However, despite what appears to be a positive picture, the SMMT has criticised the Government for changes made to the plug-in car grant scheme.

The changes, announced in October 2018, mean the grant for Category 1 vehicles – broadly those that are pure battery electric – has been reduced from £4,500 to £3,500.

In addition, Category 2 and 3 vehicles – mainly plug-in hybrids – are no longer eligible for a grant.

The number of new ‘zero emission-capable’ plug-in hybrids registered between January and May fell by 20% compared to the same period in 2018 – and the SMMT says this proves that the Government ‘prematurely removed upfront purchase incentives before the market is ready’.

Mike Hawes, SMMT chief executive, said: “While it’s great to see buyers respond to the growing range of pure electric cars on offer, they still only represent a tiny fraction of the market and are just one of a number of technologies that will help us on the road to zero.

“Industry is working hard to deliver on this shared ambition, providing ever cleaner cars to suit every need.

“We need policies that help get the latest, cleanest vehicles on the road more quickly and support market transition for all drivers. This includes investment in infrastructure and long term incentives to make new technologies as affordable as possible.”

Close to the ‘tipping point’

The rise in AFVs comes – once again – against a decline in the overall new vehicle market.

The SMMT figures show that 862,100 new vehicles were registered in the first third on 2019 – a year-on-year decline of 2.7%.

The RAC says electric vehicles are becoming ‘a wise option for many drivers’.

Pete Williams, RAC head of external affairs, said: “We are getting close to a tipping point where buying an electric vehicle is an increasingly credible option for many.

“The factors that influence choice are beginning to line up to make an electric vehicle a wise option for many drivers including: a greater, more diverse range of vehicles; significantly improved battery range; and an improving charging infrastructure.

“Ultimately price is the biggest sticking point although prices will begin to fall as demand grows.”

1 Comments

  1. It doesn’t matter how much the government pour tax payers money into grants towards electric cars, the price will always be manipulated by the manufacturer to absorb the grant and still produce a vehicle that is priced as a premium vehicle.

    If, for example VW were truly interested in helping the masses purchase battery powered vehicles then the eGolf would not be
    Solely in the top trim with an unnecessary level of standard equipment.
    Why do they not produce the vehicle in a level of trim that reduces, not increases the cost. Sat nav is not an option for example, it is standard….. when most customers are happy to use their phone sat nav via CarPlay. Or android connections and save the cost…

    I suspect the manufacturer sees government grants as a golden egg and for once i am pleased that our government isn’t flushing our money into their pockets. Although £3500 is waste enough. If there were no grants and the vehicles needed to be cheaper – they WOULD find a way to produce them cheaper……..

    Also, on a test drive of the eGolf yesterday, when I asked the salesman about the market for these vehicles as 8 year old purchases – an age at which huge percentage of the UK population buy their cars – and usually get brilliant cars with many years of motoring left in them – 70k to 80k mileage isn’t seen as high today –

    His answer was “ at 8 years old – the battery packs are likely to be no longer fit for purpose, and the vehicle scrap – as replacing the batteries is too expensive.” I checked this, and the cost of battery replacement seems to be over £5000.
    So what do the people wanting cars this age do?, and where is the environmental argument for this?
    Surely we are better off buying a petrol vehicle that lasts 15 years rather than an battery vehicle that lasts 8, as the environmental cost at manufacture is high, and needs amortising over more that 8 years to be justified….
    .

    Incidentally the EGolf was amazing, and I wouldn’t hesitate to buy one – when residuals are firm and 150K miles is the norm, as it is today with petrol vehicle. Electric vehicles are NOT complicated compared to internal combustion vehicles. — far fewer moving parts and proven technology –
    M.Smith. Cheltenham.

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