When the UK politician in charge of all transport throughout the UK - Chris Grayling - published Governments plans to get the country onto green cars just a few months ago, the car industry was positive about the UK Government’s green car credentials.
But in a surprise move, they have suddenly scrapped the £2,500 incentive available on hybrid cars. They will also be reducing the £4,500 subsidy on plug-in electric cars, down to £3,500. Both changes take effect in early November, not really giving enough time for would-be buyers to purchase a hybrid or electric car (considering current lead times) before the subsidy is reduced.
This could increase hybrid purchase prices by 10%, and electric car prices by 4%. It comes just days after international scientists said that much more needs to be done to reduce greenhouse emissions, before it is too late. It is also a big blow to the UK car sector, which is struggling in the face of UK households cutting back their spending, and also various doubts over Brexit.
Reaction from industry leaders has not been positive:
- Darren Shirley (Campaign for Better Transport) said it was “the wrong signal for the government to send”.
- Nicholas Lyes (RAC head of roads policy) said “This move from the government is a big step backwards and is in stark contrast to countries like Norway where generous tax incentives have meant that it has one of the highest ownership levels of ultra-low emission vehicles of anywhere in the world.”
- Jack Cousens (AA’s head of roads policy) said “The government wants to end the sale of petrol and diesel cars but scrapping grants for low-emission cars may well stall their progress.”
- Finally, Mike Hawes (chief exec of the main UK car trade body) said “given the importance of environmental goals, it’s astounding that… the government has reduced the incentive that gives consumers most encouragement to invest in ultra-low emission vehicles. Removing the grant for plug-in hybrids is totally at odds with already challenging ambitions for CO2 reduction and sends yet more confusing signals to car buyers.”
The UK Government’s reasoning for this move is that they want to focus solely on improving electric and hydrogen car uptake since they are becoming much more mainstream, and thus they no longer want to support (what they see) as a middle-of-the-road solution in hybrids.