Drivers across the UK will soon enjoy discounts on dozens of new electric car models after the Transport Secretary announced a £650 million grant scheme worth up to £3,750 per car, putting more money back in working people’s pockets as part of the Plan for Change and making owning an electric car a reality for thousands.
Supporting the manifesto commitment to phase out the sale of new petrol and diesel cars by 2030, the £650 million Electric Car Grant (ECG) will back UK and other manufacturers, with eligibility dependent on the highest manufacturing sustainability standards. Discounts up to £3,750 will be available at the point of sale for new eligible electric cars priced at or under £37,000.
Drivers will start to benefit from discounts as soon as manufacturers successfully apply for their zero emission cars to be part of the grant scheme from 16 July 2025, with funding available until the 2028 to 2029 financial year.
With drivers citing upfront costs as a key barrier to adoption, the grant will narrow the upfront cost between petrol and electric vehicles, giving thousands more drivers access to savings of up to £1,500 a year in fuel and running costs compared to a petrol car. The discount means that zero emission cars are now cheaper to buy and run than ever before and comes on top of preferential tax rates, delivering real savings for working families.
Melanie Shufflebotham, Co-founder and COO, Zapmap said:
“We have to make sure the switch to electric cars is fair for everyone, and up front costs are a barrier for many. So reintroducing grants for lower price models is a good move. Next we need to ensure there isn’t an in-built inequality in running costs for those who can’t charge at home, who currently pay four times the VAT rate on public chargers.”
This latest scheme builds on the government’s £63 million package to support at home charging for households without driveways, transition NHS fleets to electric and create thousands of charge points at business depots across the country.
Transport Secretary Heidi Alexander said:
“This EV grant will not only allow people to keep more of their hard-earned money – it’ll help our automotive sector seize one of the biggest opportunities of the 21st century.
“And with over 82,000 public charge points now available across the UK, we’ve built the infrastructure families need to make the switch with confidence.”
In total, the government is investing £4.5 billion to turbocharge the switch to EVs. Today, the UK is already a global leader in the transition to zero emissions driving, with the largest EV market in Europe in 2024 and sales up a fifth on the previous year.
The latest update also comes as the UK hits over 82,000 public charge points nationwide – with one added every 30 minutes – giving peace of mind to drivers that they will be able to charge conveniently at home, work or on longer journeys.
Vicky Read, CEO of ChargeUK, said:
"This announcement is brilliant news – for drivers and for the UK’s transition to electric vehicles.
With a commitment to invest £6 billion through to 2030, the UK’s charging industry has rolled out infrastructure ahead of demand to ensure that when drivers switch, the network is there to make charging as convenient as possible. There are now 82,000 public charge points and a new one goes in the ground every 29 minutes on average.
Hot on the heels of the weekend’s announcement on measures to support charging, including meeting ChargeUK’s calls for improvements to signage on main roads, today’s package is another vital boost to the charging industry, helping it invest with confidence.
