Meryem Brassington, electrification propositions lead at Lex Autolease reflects on the removal of the Plug-in Car Grant and considers what’s next for the UK’s road to electrification.

Meryem Brassington, electrification propositions lead at Lex Autolease

The withdrawal of the government’s Plug-in Car Grant came as no real surprise to fleet managers. As confidence in electric vehicles continues to gather momentum, incentives like these were never going to last forever and policy makers are right to reprioritise spending on infrastructure investment in order to achieve the UK’s Road to Zero targets.

Removing the grant completely may have an initial impact on EV affordability for some low range, entry-level model vehicles, especially at a time when supply is constrained and market pricing pressures are being felt across to board.

More importantly, there would have been a significant number of vehicles currently in the order process that will now miss out on government grants, resulting in either cost implications for businesses across the UK or people not progressing with an EV order and opting for alternative technology or holding back the purchase decision. Still, it’s encouraging to see a two-day leeway period for drivers that placed an order 48 hours prior to the removal of the grant – something we haven’t seen with previous cuts in recent years.

Yet, the reality is that in today’s money, many EV fleets haven’t been in receipt of the grant because a large proportion of the vehicles they’ve been ordering are in excess of the £32,000 plug-in car grant threshold.

Previous reductions in the grants have had little impact on the rapidly expanding EV market, either. The number of electric cars on the UK’s roads has soared, with more BEVs sold in 2021 than the total number sold in the previous five years, and fleets are accounting for a large proportion of the rising uptake. Latest vehicle registration figures from the SMMT put the EV market well on track to achieve 250,000 vehicles in 2022, up from less than 100,00 in 2019, as was forecasted at the start of the year.

While the withdrawal of the grant has caused some corners of the industry to question the move, we shouldn’t lose sight of the bigger picture. It’s vital that Government invests its spending on the uptake of EVs where it is most needed for the market to maintain its momentum and realise its true potential.

Road ahead

The £300 million grant funding will now be refocused towards accelerating the EV charging infrastructure rollout and extending Plug-in grants to boost sales of plug-in taxis, vans, trucks, motorcycles and wheelchair accessible vehicles, which still require further support to build the momentum we have seen in the transition to electric cars.

Over the next decade the economy will experience the biggest transformation we have seen for generations. There is a fundamental need to change almost all aspects of our lives – from the food we eat, the way we heat our homes, where we work, what we wear and what we drive.

Which means the transition to EV is not a ‘one-size fits all’ approach. The industry needs to scale up its approach – it is expected that there will be 25 million battery electric vehicles on UK roads in 2035, and we’ll need 390,000 public charging points to service those vehicles.

To put this to the test, we backed our own team to go the distance and travel all the way from John O’Groats to Land’s End, over the course of five days, through 20 checkpoints and more than 1,400 miles. As expected, charging infrastructure is better developed in some areas than others, and customer experience varies widely across the regions. That said, there are some really encouraging signs of change. For example, even in rural Scotland there were a surprising amount of 50kWh chargers and although many are only single devices, there was good coverage for the 30 or so cars we had on the route.

There has also been a considerable increase in the availability of charging hubs over the last few years. The number of sites where we could charge multiple vehicles at high charge rates was impressive, with many boasting eight or more rapid or ultra-rapid chargers. For high mileage fleet drivers, infrastructure such as this adds to the certainty of both being able to find a charging point and obtain a charge within an acceptable time period.

We see our role as key in the transition to EVs, working in partnership with government, car dealers, manufacturers, power providers and infrastructure constructors to identify the policies, technology and infrastructure that is required to transition to a green economy.

Central to this is the development of a strong used EV market to ensure they are accessible to all. We believe government support is essential to this.

In addition, the current advantageous Benefit in Kind (BIK) company car tax for EVs should continue and be published for 2025 onwards. This will remove the uncertainty that exists beyond 2025, allowing purchasing decisions to be made with confidence and the industry to plan effectively to maintain EV take-ups rates and the current momentum in electric transition.