From 9 November, only electric cars will be eligible for a £3500 subsidy, £1000 less than before

Mitsubishi UK's boss has called the government's decision to abolish the plug-in car grant, in place since 2011, for all vehicles other than pure-electric cars or those that can offer more than 70 miles of zero-emission range "hugely disappointing".

Currently, buyers of electric cars or those that can travel 70 miles on electric power (called Category 1) receive a £4500 subsidy towards the cost of the vehicle. For Category 2 and 3 cars, typically plug-in hybrids, it is £2500.

Under the revised system, which will begin on 9 November, owners of plug-in hybrids will no longer receive any support and the Category 1 subsidy will be reduced to £3500. The government said the decrease reflected “the recent reductions in the price of electric vehicles”.

It said it would support the next 35,000 electric cars sold, but did not elaborate on longer-term plans to encourage ultra-low-emission vehicles.

In its announcement, the government said it “has helped the plug-in hybrid market become more established, and will now focus its support on zero-emission models like pure electric and hydrogen fuel cell cars”.

It claimed it has helped support the purchase of more than 160,000 cars since 2011.

The statement added: “With plug-in hybrid models like the Mitsubishi Outlander becoming popular among consumers, the government is focusing its attention to zero-emission models such as the Nissan Leaf and BMW i3.”

The reaction

The Outlander PHEV has consistently been one of the best-selling plug-in hybrids, and Mitsubishi has expressed "surprise and disappointment" at the government decision. In a statement, the firm said it was currently "the ideal time" to offer increased plug-in incentives, because "such technology forms the perfect segue between conventional petrol and diesel powered and full electric vehicles, particularly as the charging network is nowhere near evolved enough to support widespread full EV use."

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The firm noted that under the new WLTP test regulations, only hybrids offering "real-world efficiency and a usable EV range" would qualify for the grant.

Mitsubishi Motors UK boss Rob Lindley said: “The decision to suddenly end grant support for some of the greenest vehicles on the road is extremely disappointing, but as segment leader for the past four years, we are confident despite the setback that people will still see the benefits of having a 220hp all-wheel-drive SUV that is also so efficient it attracts low VED, low benefit-in-kind rates for business users and offers huge real-world fuel cost savings compared to conventional petrol- and diesel-powered SUVs.” 

Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders, said: “We understand the pressure on the public purse but, given the importance of environmental goals, it’s astounding that just three months after publishing its 'road to zero' strategy, 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."

Hawes said plug-in hybrid electric vehicles (PHEVs) made up less than 2% of the UK car market, and noted that "as we’ve seen in other markets, prematurely removing up-front purchase grants can have a devastating impact on demand". He added: "Without world-class incentives, government’s world-class ambitions will not be delivered.”

Nicholas Lyes, the RAC’s head of roads policy, said the move was “a major blow to anyone hoping to go green with their next vehicle”. 

He added: “With up-front costs still a huge barrier for those hoping to switch to an electric vehicle, 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.” 

For the year to date, alternatively fuelled vehicles make up 6% of the UK car market, or 114,574 cars. However, electric vehicles make up a very small minority of that number.

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Comments
31

11 October 2018

Here we go again.  Tories push for uptake of less harmful motoring. Remember LPG, get the interest going them hammer the buyers with big tax increases. 

Now wait a few years and they will do the same for full electric.

The humble motorist dose not stand a chance.

whiteliner

11 October 2018
I'm an Aussie, we've got our own government to waste our taxes. But if it WAS my money, I'd be furious that my taxes were subsidising new car purchases.

13 October 2018

And our tax dollars were subsidising and funding the Aussie car companies to the tune of hundreds of millions of dollars every year. There’s nothing wrong with a government subsidising something to encourage uptake of hybrid / electric / green vehicles. In Canberra, EV’s don’t pay any stamp duty (subsidy) as one ongoing example. 

13 October 2018
antnotdec1 wrote:

And our tax dollars were subsidising and funding the Aussie car companies to the tune of hundreds of millions of dollars every year. There’s nothing wrong with a government subsidising something to encourage uptake of hybrid / electric / green vehicles. In Canberra, EV’s don’t pay any stamp duty (subsidy) as one ongoing example. 

 

I didn't have a problem with our government subsidising local manufacturing in order to retain the industry and create jobs.  According to the reports I read, all automotive manufacturing countries subsidise their local industries to some extent.

13 October 2018

Taxpayer subsidy can only be justified through wider benefits to society, not a tax break to the relatively well off.

It seems most of these plug in hybrids are never plugged in, which makes me wonder why I am expected to help pay for them.

 

11 October 2018

Plug in hybrids that more or less nobody will ever plug in, shouldn’t be subsidised by the taxpayer, especially as their contribution to greenhouse gases is inevitably higher than non-hybrids, due to their increased weight.

Reducing the subsidy on BEV’s is more debatable: I’m guessing the advent of affordable Hyundai cars in this category and the imminent flood of others, is behind the government decision. And tbere’s always an argument that any subsidy runs the risk that the manufacturer simply adds that amount to the asking price and pockets the extra profit. However. Combustion cars have to be eliminated if 1,5 degrees of global warming is to be avoided and the UK is far from being on track...

Robbo

Aussie Rob - a view from down under

11 October 2018
Aussierob wrote:

Plug in hybrids that more or less nobody will ever plug in, shouldn’t be subsidised by the taxpayer, especially as their contribution to greenhouse gases is inevitably higher than non-hybrids, due to their increased weight.

Reducing the subsidy on BEV’s is more debatable: I’m guessing the advent of affordable Hyundai cars in this category and the imminent flood of others, is behind the government decision. And tbere’s always an argument that any subsidy runs the risk that the manufacturer simply adds that amount to the asking price and pockets the extra profit. However. Combustion cars have to be eliminated if 1,5 degrees of global warming is to be avoided and the UK is far from being on track...

Robbo

On what basis do you know this?  its bollocks. Everyone I know with a plug-in, plugs in, why wouldn't you? its cheaper per mile than petrol!Outside of work mine runs around locally and at weekends quite happily on battery without polluting. Even on longer journeys, say a 100 miles, for around 25% of it I am running clean from battery so my average emission level is comparable to a diesel and better than other petrol vehicles of similar size.

 

FMS

12 October 2018
The Apprentice wrote:

Aussierob wrote:

Plug in hybrids that more or less nobody will ever plug in, shouldn’t be subsidised by the taxpayer, especially as their contribution to greenhouse gases is inevitably higher than non-hybrids, due to their increased weight.

Reducing the subsidy on BEV’s is more debatable: I’m guessing the advent of affordable Hyundai cars in this category and the imminent flood of others, is behind the government decision. And tbere’s always an argument that any subsidy runs the risk that the manufacturer simply adds that amount to the asking price and pockets the extra profit. However. Combustion cars have to be eliminated if 1,5 degrees of global warming is to be avoided and the UK is far from being on track...

Robbo

On what basis do you know this?  its bollocks. Everyone I know with a plug-in, plugs in, why wouldn't you? its cheaper per mile than petrol!Outside of work mine runs around locally and at weekends quite happily on battery without polluting. Even on longer journeys, say a 100 miles, for around 25% of it I am running clean from battery so my average emission level is comparable to a diesel and better than other petrol vehicles of similar size.

 

 

Shame your exhibited knowledge is so lacking...most PHEV's are bought as company cars, run by employees who benefit from the lower level of taxation, but are free to use filling stations and do so rather than plug-in and wait and wait...running costs are much less important to them and they can justify this by claiming back to back meetings, etc to rationalise low levels of plug in time.

 

How many cars belong to drivers that you say you "know"?...and do they represent a significant sample of the UK total number?.

 

Look in the mirror when you call out b******s next time.

12 October 2018
FMS wrote:

The Apprentice wrote:

Aussierob wrote:

Plug in hybrids that more or less nobody will ever plug in, shouldn’t be subsidised by the taxpayer, especially as their contribution to greenhouse gases is inevitably higher than non-hybrids, due to their increased weight.

Reducing the subsidy on BEV’s is more debatable: I’m guessing the advent of affordable Hyundai cars in this category and the imminent flood of others, is behind the government decision. And tbere’s always an argument that any subsidy runs the risk that the manufacturer simply adds that amount to the asking price and pockets the extra profit. However. Combustion cars have to be eliminated if 1,5 degrees of global warming is to be avoided and the UK is far from being on track...

Robbo

On what basis do you know this?  its bollocks. Everyone I know with a plug-in, plugs in, why wouldn't you? its cheaper per mile than petrol!Outside of work mine runs around locally and at weekends quite happily on battery without polluting. Even on longer journeys, say a 100 miles, for around 25% of it I am running clean from battery so my average emission level is comparable to a diesel and better than other petrol vehicles of similar size.

 

 

Shame your exhibited knowledge is so lacking...most PHEV's are bought as company cars, run by employees who benefit from the lower level of taxation, but are free to use filling stations and do so rather than plug-in and wait and wait...running costs are much less important to them and they can justify this by claiming back to back meetings, etc to rationalise low levels of plug in time.

 

How many cars belong to drivers that you say you "know"?...and do they represent a significant sample of the UK total number?.

 

Look in the mirror when you call out b******s next time.

Again on what basis do you make such a sweeping declaration?. We have a substantial number on our large company fleet and are still adding, BMW's, Kia Niro PHEVS. We don't issue them to people without a facility to plug in at home. Some now have workplace charger access at our sites too, free fuel so of course they plug in. And at home who wouldn't plug in when it costs 2.5p a mile and they are being reimbursed 15p a mile. pr

12 October 2018
The Apprentice wrote:

FMS wrote:

The Apprentice wrote:

Aussierob wrote:

Plug in hybrids that more or less nobody will ever plug in, shouldn’t be subsidised by the taxpayer, especially as their contribution to greenhouse gases is inevitably higher than non-hybrids, due to their increased weight.

Reducing the subsidy on BEV’s is more debatable: I’m guessing the advent of affordable Hyundai cars in this category and the imminent flood of others, is behind the government decision. And tbere’s always an argument that any subsidy runs the risk that the manufacturer simply adds that amount to the asking price and pockets the extra profit. However. Combustion cars have to be eliminated if 1,5 degrees of global warming is to be avoided and the UK is far from being on track...

Robbo

On what basis do you know this?  its bollocks. Everyone I know with a plug-in, plugs in, why wouldn't you? its cheaper per mile than petrol!Outside of work mine runs around locally and at weekends quite happily on battery without polluting. Even on longer journeys, say a 100 miles, for around 25% of it I am running clean from battery so my average emission level is comparable to a diesel and better than other petrol vehicles of similar size.

 

 

Shame your exhibited knowledge is so lacking...most PHEV's are bought as company cars, run by employees who benefit from the lower level of taxation, but are free to use filling stations and do so rather than plug-in and wait and wait...running costs are much less important to them and they can justify this by claiming back to back meetings, etc to rationalise low levels of plug in time.

 

How many cars belong to drivers that you say you "know"?...and do they represent a significant sample of the UK total number?.

 

Look in the mirror when you call out b******s next time.

Again on what basis do you make such a sweeping declaration?. We have a substantial number on our large company fleet and are still adding, BMW's, Kia Niro PHEVS. We don't issue them to people without a facility to plug in at home. Some now have workplace charger access at our sites too, free fuel so of course they plug in. And at home who wouldn't plug in when it costs 2.5p a mile and they are being reimbursed 15p a mile. pr

I think this level of commitment to sustainability is unusual.  Our clients don't do this.  Which organisation is doing this?

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