Government EV Subsidy Announced
· New car buyers can get up to £3,750 off a new EV priced at £37,000 or less.
· To qualify, car brands must meet Science-Based Target Initiative (SBTi) requirements.
· If a brand doesn’t qualify for the full grant, buyers could still receive £1,500 off.
Discount on electric cars to cut costs for thousands
Drivers across the UK will soon enjoy discounts on dozens of new electric car models after the Transport Secretary announced a £650 million grant scheme worth up to £3,750 per car, putting more money back in working people’s pockets as part of the Plan for Change and making owning an electric car a reality for thousands.
Supporting the manifesto commitment to phase out the sale of new petrol and diesel cars by 2030, the £650m Electric Car Grant (ECG) will back UK and other manufacturers, with eligibility dependent on the highest manufacturing sustainability standards. Discounts up to £3,750 will be available at the point of sale for new eligible electric cars priced at or under £37,000.
Drivers will start to benefit from discounts as soon as manufacturers successfully apply for their zero emission cars to be part of the grant scheme from 16 July 2025, with funding available until the 2028/29 financial year.
What This Means for Retailers:
1. 2030 Deadline Reaffirmed
o The government’s investment signals clear commitment to the 2030 EV transition.
o Now’s the time for retailers to plan, prepare and start selling EVs if they haven’t already.
2. Boost in New EV Demand Expected
o Sales teams should be ready: merchandising, pricing, and product descriptions must reflect the grant.
o Retailers need to anticipate and confidently answer common consumer questions about EVs (charging, battery health, etc.) - you can use The Facts for this.
o Autotrader’s Insight Academy offers EV-specific training.
3. Pressure on Used EV Market
o Lower prices on new EVs may impact demand for younger used ones.
o Retailers must rethink pricing and strategy around stock and competitiveness - data will be key for these decision making processes.
Today, the UK is already a global leader in the transition to zero emissions driving, with the largest EV market in Europe in 2024 and sales up a fifth on the previous year.
The latest update also comes as the UK hits over 82,000 public charge points nationwide – with one added every 30 minutes – giving peace of mind to drivers that they will be able to charge conveniently at home, work or on longer journeys.
This latest move comes alongside the Zero Emission Vehicle (ZEV) Mandate, which requires manufacturers to sell increasing percentages of zero emission vehicles each year. Recent changes to the mandate give industry the certainty, stability, and support they’ve been asking for, alongside crucial trade deals with the US, India and the European Union following the recent global economic headwinds.