EV makers lose patience with incentive scheme and offer own discounts

Times

4 days ago

Carmakers have begun discounting electric vehicles as they seek to capitalise on increased consumer interest as well as confusion over government grants.
Hyundai and Volvo are among the growing number of brands voluntarily knocking thousands of pounds off the prices of their cars because an official scheme to encourage the uptake of EVs is taking so long to launch.
Ministers announced two weeks ago that motorists buying new EVs with a list price under £37,000 would be eligible for grants of up to £3,750, a move designed to reverse a collapse in demand for EVs among private buyers.
However, manufacturers have complained that they face an 'extraordinary' amount of paperwork to find out whether their vehicles are eligible for grants, while buyers have been left in limbo despite being told the scheme was under way.
Dealers and online marketplaces reported a huge increase in interest in EVs after the announcement but were unable to offer advice to potential buyers as they were in the dark over what vehicles would comply.
Under the scheme, qualifying cars will be discounted by either £1,500 or £3,750, depending on their environmental impact. Hyundai and Volvo have opted to knock £3,750 off certain new models while they await a decision from the government on their eligibility.
Hyundai has applied the full discount to its Inster hatchback, bringing the price down to £19,755. The Ioniq 5, Ioniq 6 and Kona Electric have been reduced by £1,500.
Alfa Romeo has reduced the list price of the Junior Elettrica — the Italian marque's first EV — by £1,500. MG, which is Chinese-owned, is discounting its 4 EV hatchback and new S5 electric crossover by the same amount.
An industry source said: 'The government scheme was announced without consultation and without any detail of how it would work in practice. Yet consumers were led to believe it was up and running from day one.
'There was a huge boost in interest for EVs because of all the publicity but the brands and dealers didn't even know if their vehicles were eligible and still don't. That's why we are seeing these discounts: because at the end of the day, a sale is a sale.'
Other Chinese entrants to the UK market, including Leapmotor, Skywell and GWM, are also discounting cars. However, they are unlikely to be eligible for the government scheme because their cars will not meet the environmental requirements. Japanese and South Korean-made cars are also expected to be excluded.
The scheme has rigid rules around 'science-based' targets — emissions targets brands can voluntarily sign up to — and manufacturing locations. Brands are expected to detail supply-chain emissions for some parts, components and materials used in the manufacturing process.
Even ardent supporters of the grant scheme have been baffled by its rollout. They question why consumers were told it was available before manufacturers had been told to apply.
Dan Caesar, chief executive of the trade group Electric Vehicles UK, said: 'The electric car grant certainly created a positive spike in consumer interest in battery EVs but reaction in the industry itself was more mixed. On one hand, it's good to see support for EVs and for charging. On the other hand, there is a feeling that a better outcome could have been reached if a wider group of stakeholders had been heard.'
The Department for Transport said: 'The electric car grant will bring about a substantial boost for the industry, while saving drivers thousands of pounds and supporting jobs. We want the discounts to become available to drivers as soon as possible and we are engaging extensively with vehicle manufacturers and have published guidance to help them apply as easily as possible.'