Ahead of next month’s Budget announcement, the National Franchised Dealers Association (NFDA) urged the government to safeguard the current electric vehicle plug-in grant.
“UK motorists should continue to receive incentives to ensure a consistent and successful transition to electric vehicles, in particular, this must include preserving the current plug-in grant,” said Sue Robinson, director of the NFDA.
Despite the significant growth seen in the sector over the last year, combined alternative fuel vehicle registrations accounted for just 11.9% of the total market in January. NFDA said feedback from retailers and consumers suggests that the price of electric vehicles continues to be one of the most prohibitive barriers to increased uptake.
Currently, no plug-in car grant funding is guaranteed beyond 2020. As a result, 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, said the NFDA.
The association also called for a more balanced Vehicle Excise Duty (VED) system. The current system sees all vehicles under £40,000 pay the same standard fee after the first year VED payment, unless they emit zero CO2 emissions.
NFDA wants a vehicle’s whole lifecycle to be accounted for, and does not wish to see higher CO2 emitting vehicles pay less VED. This way the system would incentivise cleaner purchases in the new, used and nearly new sectors.
Robinson added: “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.
“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.”