OZEV: making a managed exit from Plug-in Car Grant

THE Plug-in Car Grant, given a value shave and price cap on 18 March 2021, will gradually be remaindered. Current funding is planned to last until 2022-23.

The information was relayed to a meeting organised by the National Franchised Dealers Association (13 May, 2021), when representatives from the Office for Zero Emission Vehicles – OZEV, previously known as OLEV – provided clarification about the Plug-in Car Grant.

Talking to the franchised dealers present, OZEV clarified a number of points.

Future changes to the grant

OZEV explained that the plug-in grants had been designed to support the uptake of ultra-low and zero emission vehicles during the early stages of the market. However, the government intended to “gradually deliver a managed exit” from the grants (which have been extended until 2022/23), although OZEV did add that vehicle uptake would be continued through other measures.

OZEV added that during the early stages of the grant, when uptake was low, it was able to provide advance notice of any changes.

However, with increasing demand, a very short notice period ahead of the grant rates in March 2020 led to a large spike in orders between the announcement and the changes coming into effect. On this point OZEV noted that the “government has a responsibility to manage the grant budget and to deliver value for money for taxpayers”.

In future OZEV said the pug-in grant would be kept under review. Subsequent changes, in all likelihood, would also be introduced without warning.

Definition of the Plug-in Car Grant price cap

OZEV also provided clarity around the price cap definition stating cars must be priced below £35,000 RRP to be eligible for the grants.

In particular, the price cap definition includes “any non-standard option fitted by the manufacturer or dealer affecting the capacity of the battery, drive train configuration or maximum net power”; and it does not include “any non-standard option fitted by the manufacturer or dealer which does not affect the capacity of the battery, drivetrain configuration or maximum net power”*.

Sue Robinson, NFDA chief executive commented:

“NFDA has been working closely with the government’s Office for Zero Emission Vehicles over the past years, especially, since the launch of our government co-funded Electric Vehicle Approved accreditation scheme and the development of our EV working group.

“Today’s session proved extremely useful in providing retailers with further clarity around the plug-in grant, including details on the definition of price cap which not all dealers are aware of.

“Going forward, we will continue to work closely with OZEV to best represent our members’ interests and, in turn, provide franchised dealers with clear and timely guidance”.

Further details on price cap definition

Definition of price for application of the cap to be eligible for the PICG, eligible cars must be priced below £35,000 RRP. The definition of price includes:

• VAT, including VAT reclaimable by a business

• vehicle manufacturer or dealer’s mandatory extras including delivery charges or administration fees

• the battery cost (including where the battery is leased)

• any non-standard option fitted by the manufacturer or dealer affecting the capacity of the battery, drive train configuration or maximum net power

and excludes:

• any non-standard option fitted by the manufacturer or dealer which does not affect the capacity of the battery, drivetrain configuration or maximum net power.

• modifications such as ‘police packs’, ambulance/fire engine modifications

• modifications for disabled users

• warranty/insurance and service packages etc

• first registration fee and cost of first licence

• discounts (including rebates)

Where a vehicle model has a price range which straddles the cap only those variants/trim levels priced below the cap will be eligible for the grant. Variants or trim levels of eligible vehicles which are priced above the price cap are not eligible for the grant.