London Daily

Focus on the big picture.
Saturday, Oct 24, 2026

UK cuts grants for electric vehicles for second time in a year

UK cuts grants for electric vehicles for second time in a year

Subsidy available will fall from £2,500 to £1,500 – half the sum available to buyers at the start of the year
The UK government has cut grants for electric vehicles for the second time in a year, provoking the anger of the car industry and prompting a call for car tax to be redesigned.

The grant available for electric cars will fall from £2,500 to £1,500 – half the sum available to buyers at the start of the year. The upper price limit for eligible car models will fall from £35,000 to £32,000, down from £50,000 in March.

The government is also cutting the grant on large and small vans from £6,000 to £5,000 and £3,000 to £2,500 respectively, it said in an announcement on Wednesday.

Electric cars – which produce zero carbon dioxide exhaust emissions – accounted for 19% of cars sold in the UK in November, as carmakers bring a series of new models to market and demand soars amid rocketing fuel prices.

The government is helping with a mixture of stick – including large fines for carmakers who make too many polluting cars – and carrots like the plug-in car grant and some tax exemptions.

However, the rising take-up of electric cars has presented a problem to the Treasury, which has been alarmed by the increasing cost of subsidies, many of which are enjoyed by wealthier buyers who can afford a new electric car, as well as the impact on fuel duty.

Some experts argue that government funding would be better aimed at problems such as still-patchy charging infrastructure. At the same time, the government has allocated as much as £50bn in implicit subsidies to petrol and diesel consumption by freezing fuel duty for a decade.

Greg Archer, UK director of Transport & Environment, a campaign group, said: “I think it’s inevitable that grants will be progressively phased out, and it’s right that they should be. The government can’t keep bankrolling this transition, but it needs to make sure there are good incentives for all parts of the market.

“We could be doing just as much by increasing the taxes on large, high-emitting vehicles.”

The industry argues that the government should not be making electric cars more expensive while also trying to encourage more people to buy them.

Paul Willcox, the managing director of British brand Vauxhall, which is owned by multinational conglomerate Stellantis, said a “more strategic, longer-term approach” was required from government, and argued that the UK is lagging behind other European countries which are still heavily subsidising purchases.

Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders, said: “Slashing the grants for electric vehicles once again is a blow to customers looking to make the switch and couldn’t come at a worse time, with inflation at a 10-year high and pandemic-related economic uncertainty looming large.

“We need to move the market even faster – from one in a hundred cars on the road being electric, to potentially one in three in just eight years – which means we should be doubling down on incentives.”
Newsletter

Related Articles

0:00
0:00
Close
Tour de France Organizers Confirm Historic Grand Depart Featuring Edinburgh and Yorkshire Stages
National Cyber Security Centre Issues Urgent Alerts Following Global Security Vulnerability in Core Programming Software
Independent Energy Analysts Warn Great Britain Faces Highest Winter Power Tariffs in Europe
Major British Defense Contractors Commit to Delivering Forty Thousand New Apprenticeships and Training Placements
New Bradford Railway Station Infrastructure Project Approved to Transform Regional Transit Connectivity Across Northern England
Welsh Infrastructure Stakeholders Press Government for Accelerated Local Sourcing in Military and Uniform Manufacturing
Scottish Council Governance Crisis Triggers High-Court Legal Challenge Over Leadership Ouster Bid
High Street Bakery Chain Greggs Announces Major Factory Closures and Seven Hundred Job Cuts
Automotive Manufacturer Jaguar Land Rover Advances Advanced Defense Technology Partnership with European Allies
Treasury and Bank of England Officials Signal Persistent Concern Over Inflation-Driven Interest Rate Path
International Monetary Fund Upgrades United Kingdom Growth Forecast While Issuing Inflation Warnings
National Health Service Leaders Warn of Severe Capacity Pressures as Early Winter Respiratory Infections Surge
Government Issues Emergency Resilience Guidance Advising All British Citizens to Stockpile Essential Supplies
United Kingdom Private Sector Growth Beats Expectations in October Driven by Resilient Services and Manufacturing
Barclays to Cut Five Thousand Jobs in Major Artificial Intelligence Adoption and Cost-Cutting Overhaul
Piper Tomahawk Aircraft Crash Near Drymen in Stirling Claims Two Lives as Investigators Deploy
North Sea Transition Authority Approves Jackdaw Gas Field Production After Ministerial Authorization
Government Injects One Hundred and Forty Million Pounds to Expand Urgent Care Ahead of Winter Crisis
Department of Health Warns Further Pay Rises Will Derail National Health Service Waiting List Targets
Major Environmental Emergency Declared in South Wales Following Aerospace Kerosene Spill
Tank Barrel Production Returns to Britain as Defence Contractors Accelerate Domestic Rearmament
Government Approves Controversial Jackdaw Gasfield Development in the North Sea
National Health Service Maternity Safety Review Condemned Over Flawed Artificial Intelligence Integration
Dozens of United Kingdom Government Services Taken Offline Amid Critical Software Vulnerability
Barclays Announces Five Thousand Job Cuts Citing Artificial Intelligence Productivity Gains
Treasury Relaxes Post-Financial Crisis Accountability Rules for City of London Executives
United Kingdom Government Issues Unprecedented Guidance Urging Citizens to Stockpile Essential Supplies
United Kingdom Consumer Inflation Accelerates to Eleven-Month High Driven by Transport Costs
United Kingdom Public Sector Net Debt Breaches Three Trillion Pounds Ahead of Autumn Budget
Department for Science, Innovation and Technology Commits Fifty Million Pounds to Establish Regional Artificial Intelligence Innovation Clusters
Ofgem Directs Major Energy Suppliers to Expand Vulnerable Household Support Funds Ahead of Winter Heating Season
Home Office and National Police Chiefs Council Unveil New Intelligence-Led Strategy to Tackle Organised Immigration Crime Networks
First Minister John Swinney Secures Scottish Parliament Approval for Comprehensive Climate and Green Energy Infrastructure Strategy
National Health Service England and Trades Union Congress Finalize Agreement on Emergency Winter Staffing and Pay Frameworks
HM Treasury and Department for Business and Trade Announce Multi-Billion-Pound Sovereign Investment Pact to Spur Regional Advanced Manufacturing
Bank of England Governor Andrew Bailey Signals Potential for Faster Interest Rate Cuts as Domestic Inflation Pressures Ease Below Forecasts
Parliamentary Inquiry Highlights Urgent Need to Address Housing Shortage as Scottish Completions Hit Eleven-Year Low
United Kingdom and Singapore Sign Comprehensive Financial Agreement to Deepen Digital and Sustainable Market Ties
Greggs Announces Plan to Close Four Manufacturing Facilities and Cut Seven Hundred and Forty Jobs
International Monetary Fund Raises United Kingdom Economic Growth Forecast While Warning of Inflationary Pressures
Energy Security and Net Zero Committee Urges Government to Shift Policy Costs Onto Gas to Lower Household Bills
Housebuilding Across Scotland Plummets to Eleven-Year Low Despite Government Pledges to Tackle National Housing Emergency
Greggs Announces Factory Closures Across Northern England and Scotland Affecting Seven Hundred Forty Jobs
United Kingdom and Singapore Conclude Eleventh Financial Dialogue in Singapore to Deepen Cooperation on Digital Finance and Capital Markets
Energy Security and Net Zero Committee Urges Government to Shift Policy Costs to Gas Bills and Tap Windfall Profits to Lower Consumer Prices
British Broadcasting Corporation Announces Major Cost-Cutting Overhaul to Close Linear Broadcast Services for Television Channels BBC Three and BBC Scotland Alongside Digital Radio Station BBC Radio Four Extra
London Capital Markets Face Renewed Scrutiny After High-Profile Offerings Underperform Post-Listing
Green Party Wins Historic First Westminster Parliamentary By-Election in Gorton and Denton
Environment Secretary Emma Reynolds Unveils Sweeping Regulatory Overhaul for English Water Industry
United Kingdom Health Security Agency Confirms Thirty-Four Cases in Kent Meningitis Outbreak
×