Supporting the manifesto commitment to phase out the sale of new petrol and diesel cars by 2030, the £650 million Electric Car Grant (ECG) will back UK and other manufacturers, with eligibility dependent on the highest manufacturing sustainability standards.

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

Drivers will start to benefit from discounts as soon as manufacturers successfully apply for their zero emission cars to be part of the grant scheme from 16 July, with funding available until the 2028/29 financial year.

This latest investment is part of the Government’s major plan to support motorists, including a record £1.6 billion invested to tackle potholes and freezing the fuel duty at 5p until spring 2026, saving the average motorist £50–£60 over the 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."

This latest scheme builds on the Government's major £63 million package to support at home charging for households without driveways, transition NHS fleets to electric, and create thousands of chargepoints at business depots across the country.

In total the Government is investing £4.5 billion to turbocharge the switch to EVs, securing Britain’s position as a world-leader in electric vehicle adoption while helping put more money in people’s pockets. Today, the UK is already a global leader in the transition to zero emissions driving, with the largest EV market in Europe in 2024 and sales up a fifth on the previous year.

The latest update also comes as the UK hits over 82,000 public chargepoints nationwide – with one added every 30 minutes – giving peace of mind to drivers that they will be able to charge conveniently at home, work or on longer journeys.

This latest move comes alongside the Zero Emission Vehicle (ZEV) Mandate, which requires manufacturers to sell increasing percentages of zero emission vehicles each year. Recent changes to the mandate give industry the certainty, stability, and support they’ve been asking for, alongside crucial trade deals with the US, India and the European Union following the recent global economic headwinds.

RAC head of policy Simon Williams said:

“Within weeks, discounted cars should start appearing at dealerships across the country. And, as the biggest savings will be given to cars with the strongest ‘green’ manufacturing credentials, drivers will be picking models that are not only better for their wallets, but better for the planet too.

“This is further welcome news following last week’s announcement about more funding for pavement gully charging solutions that will enable those without driveways to charge an EV at home. Together, these initiatives should mean more drivers than ever start benefitting from the lower costs of running an electric car."

• Share on Facebook
• Share to X