£650 million Electric Car Grant scheme launched

The transport secretary has announced a £650 million grant scheme, giving discounts of up to £3,750 to drivers when they switch to an electric vehicle.

The £650 million Electric Car Grant (ECG) will support the UK’s commitment to phase out the sale of new petrol and diesel cars by 2030, help vehicle manufacturers, and allow many more people to be able to afford an electric car.

Discounts up to £3,750 will be available at the point of sale for new eligible electric cars priced at or under £37,000.

Manufacturers can apply to be part of the grant scheme from tomorrow (16th July 2025), with funding available from the 2028 to 2029 financial year. 

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 chargepoints now available across the UK, we’ve built the infrastructure families need to make the switch with confidence.

“This is our Plan for Change in action. We’re backing British drivers, British jobs and British growth.”

Mike Hawes, SMMT chief executive, said: “Today’s announcement of the return of government support for the purchase of electric vehicles is a clear signal to consumers that now is the time to switch.

“Rapid deployment and availability of this great over the next few years will help provide the momentum that is essential to take the EV market from just one in four today, to four in five by the end of the decade.

“This announcement is a welcome response to consistent calls from the industry for more support, which will be in addition to the substantive subsidies already provided by manufacturers. Take with recent announcements regarding infrastructure investments and the Industrial Strategy, the UK has the opportunity to maintain its position as a leader in both the manufacturer and sale of zero emission vehicles.”