The government has reduced the amount of financial assistance that companies can claim on the purchase of an electric or hybrid light commercial vehicle. Where it had been possible to claim up to 20% of the price of an EV LCV, to a maximum of £8,000, the government has introduced two new grant limits, depending on vehicle weight. For smaller vans under 2,500kg GVW, the grant will drop to 35% of the cost, to a maximum of £3,000. For larger vans it will be set at 20% of purchase cost, with a limit of £6,000. In both cases, the vehicles must be capable of travelling at least 60 miles emission-free, while overall CO2 levels, for hybrids, must be less than 50g/km.
“News from the UK government that plug-in grants for passenger and commercial vehicle customers are being reduced is disappointing and is not conducive to supporting the zero-emissions future we all desire,” said Graham Hoare, chairman of Ford of Britain.
“Robust incentives, both purchase and usage, that are consistent over time, are essential if we are to encourage customers to adopt new technologies, not just for all-electrics, but other technologies too like PHEVs, that pave the way to a zero emissions future.”
“Fleet adoption of electric vans has barely begun, simply because of lack of availability of models,” said Paul Hollick, chair of the Association of Fleet Professionals. “To reduce the grants substantially, just as they are starting to enter production, is a little mystifying.”
The news is worse for car buyers, as the government has reduced the Plug-in Car Grant from £3,000 to £2,500 and capped the upper price limit for the car at £35,000, removing many more expensive EVs from the scheme. At least there is no cap on value for the van grant. But, with EV van adoption just starting to grow, the decision does seem poorly timed.
“This is a retrograde step by the government that comes without any warning and at a time when incentives are vital to encouraging drivers and fleet buyers to make the switch to greener motoring,” said Mark Barrett, general manager of Harris Maxus.
“There is a growing range of EV vans in the market and many tenders in process awaiting to be awarded. This move will alter the dynamic of commercial fleet tenders, for which price is a huge factor and may now result in fleet buyers delaying the move to electric.”