New Electric Car Grant sparks questions, not confidence

A new £650 million fund to help EV purchases sounds good on paper, but does more to help industry than the average UK car buyer, argues Stuart Masson, editorial director of The Car Expert.

The Government’s new £650 million Electric Car Grant (ECG), offering up to £3,750 off new electric cars priced under £37,000, looks good in a headline. But in reality, it feels like another policy designed to help car manufacturers far more than ordinary drivers.

At a time when an overwhelming majority of households buy used cars rather than new, focusing £650m entirely on new vehicle sales seems short-sighted. There’s nothing here for used EV buyers – no support for those looking to switch from older, higher-polluting petrol and diesel cars to more affordable second-hand electric vehicles. If cutting emissions is the goal, wouldn’t helping these drivers make the most difference?

Mixed messaging

There’s also the question of whether this money will genuinely lower prices. History suggests otherwise. As seen with past EV grants, solar panel incentives and even stamp duty cuts, manufacturers and dealers often adjust prices upwards when grants are available – reducing or even eliminating the benefit for consumers. This, therefore, risks becoming just another subsidy absorbed into the industry’s bottom line.

Meanwhile, the Government’s approach feels inconsistent. This year alone, taxes on EVs have increased: road tax and Congestion Charge liability are coming for EVs from 2025, and cars priced above £40,000 face the same luxury car tax applied to petrol and diesel models. Now, suddenly, grants are back on the table to drive down EV prices. Such mixed messages undermine public confidence and feed into the myth that EVs are only affordable with government handouts.

Money better spent elsewhere

Perhaps most frustrating of all, today’s funding could have tackled the UK’s biggest EV challenge: infrastructure. Poor public charging access remains the single biggest barrier for many would-be EV owners. Investing £650 million into charging stations across the UK would have benefited every EV driver – new and used – and accelerated adoption in every region.

In short, while this new grant will help some drivers, it’s hard to ignore the sense that industry lobbying has won out over strategic thinking. Supporting electric cars is essential – but this scheme feels more like a quick headline win than a real plan for change.”