While electric vehicle adoption has been steadily growing across the UK, a significant breakthrough was announced yesterday with the government’s new grant scheme offering up to £3,750 off EVs priced under £37,000. The ambitious £650 million fund, available until 2028/29 or until depletion, aims to tackle one of the primary obstacles to mass EV adoption: the prohibitive upfront cost.
The EV revolution accelerates with a bold £650 million grant scheme tackling the greatest barrier to widespread adoption—affordability.
The tiered grant system rewards manufacturers with the lowest carbon footprints in their production processes. Models like the Dacia Spring, priced at just £14,995, will become substantially more affordable, potentially transforming the entry-level EV market. Similar to income restrictions established in other countries, premium manufacturers like Tesla will likely be excluded, as their vehicles typically exceed the £37,000 price cap and may not meet the stringent sustainability standards required.
Working families stand to benefit most from this initiative. With potential fuel and running cost savings of approximately £1,500 annually compared to petrol vehicles, plus preferential tax rates, EV ownership is set to become accessible to thousands more drivers. The eco-conscious charge point network continues to expand with over 82,000 public charging stations now accessible throughout the UK. The economics now make sense for the average household. The used EV market is also becoming more accessible with 2 in 5 electric cars now selling for under £20,000.
The eligibility criteria are particularly rigorous. Manufacturers must demonstrate robust sustainability credentials and possess clear net-zero targets. The grant amount directly correlates with CO2 emissions in manufacturing, assessed through detailed supply chain data. Only vehicles with transparent, low-carbon assembly processes will qualify for the full grant.
This scheme forms part of a broader strategy to increase EV market share from 25% to 80% by 2030, supporting the UK’s commitment to end new petrol and diesel car sales by that date. The automotive industry, which registered over 380,000 zero-emission cars last year, has long called for such governmental support.
Manufacturers can apply for inclusion from July 16, 2025, with discounts becoming available shortly thereafter. The initiative signals a significant shift in the UK’s transport landscape, making EVs a realistic option for mainstream consumers while simultaneously pushing the industry toward greener production methods.
