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NFDA urges Government to safeguard plug-in car grant

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The National Franchised Dealers Association (NFDA) has urged Government to safeguard the plug-in car grant (PCIG) in order to “ensure a consistent and successful transition to electric vehicles” by 2035.

Speaking a month ahead of March 11’s Budget, NFDA director Sue Robinson spelled out her support for the PICG, which hands car buyers £3,500 to soften the effect on their buying decision of electric vehicle (EV) price premiums.

“UK motorists should continue to receive incentives to, in particular, this must include preserving the current plug-in grant”, said Robinson.

“Cost continues to represent one of the key barriers to the uptake of EVs and the plug-in car grant is therefore key to broadening the appeal of zero-emission vehicles at this early stage of the market.”

UK Prime Minister Boris Johnson announced at last Tuesday’s (February 4) launch of the COP26 United Nations climate summit that the UK Government is poised to ban the sale of all hybrid, petrol and diesel cars from 2035.

But the cost of buying into the new drivetrain technology, along with concerns about EV charging infrastructure and the UK’s energy infrastructure continue to raise questions about the rate of change, as Cazana recently stated in a ‘guest opinion’ post for AM.

In January, combined alternative fuel vehicle (AFV) registrations accounted for only 11.9% of the market, according to registrations data published by the Society of Motor Manufacturers and Traders (SMMT).

Currently, no plug-in car grant funding is guaranteed beyond 2020, the NFDA highlighted, adding that uncertainty and confusion over this important incentive may affect consumer confidence in the plug-in vehicle market, to the detriment of both the environment and industry, on an ongoing basis.

Back in October 2018 AM reported how cuts to the Government’s ULEV plug-in car grants were attacked as “short-sighted” and “frankly bonkers” by industry experts amid a drive to cut emissions by encouraging EV adoption.

Car buyers looking to invest in a full EV saw their grant entitlement fall from £4,500 to £3,500 from November that year after the Department for Transport (DfT) confirmed its decision to reduce the PICG for hybrids by £1,000 and no longer apply to cars with a zero-emissions range of less than 70 miles.

Quoted in AM’s sister title, Fleet News, at the time, ACFO chairman John Pryor said: “The Government’s decision to reduce financial support for plug-in vehicles is, quite frankly bonkers.”

Commenting on the need for ongoing financial support for EVs this week, Robinson: “With the ban on petrol, diesel and hybrid cars brought forward to 2035, the role of franchised retailers in providing accurate information to the mass-market is more important than ever.

“Lack of affordability must not be the reason consumers hold on their existing vehicles rather than buying an electric car. 

“Government must end the uncertainty by protecting the grant and provide consumers and industry with a clear roadmap for the future of the grant.”

The NFDA has also called for a more balanced Vehicle Excise Duty (VED) system in its submissions to the Government ahead of next month’s Budget statement in the House of Commons.

Currently, following the first year VED payment, all vehicles under £40,000 pay the same standard fee unless they emit zero CO2 emissions.

NFDA does not wish to see higher CO2 emitting vehicles pay less VED.

Instead, the dealer trade association wants a vehicle’s whole life cycle to be accounted for. In this way, the VED system would incentivise cleaner purchases not only in the new car market but also in the used and nearly new sectors, it believes.

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