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 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."
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.”