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On 15 July 2025, the UK Government announced a significant initiative aimed at making electric vehicles (EVs) more affordable through the reintroduction of a substantial EV purchase grant. Supported by a £650 million fund, this grant targets one of the primary obstacles to EV adoption: upfront costs.
The new Electric Car Grant will offer up to £3,750 off the price of eligible EVs. Beginning 16 July 2025, this scheme will apply to new electric cars priced at £37,000 or less, enabling drivers to access more affordable zero-emission vehicles at the point of sale.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.
A Two-Tier System for Sustainability
In contrast to previous programs, this grant introduces a two-tier system that incentivises sustainable manufacturing practices. Vehicles from manufacturers who meet stringent environmental criteria, such as setting science-based climate targets and producing EVs and batteries with low carbon emissions, will qualify for the full £3,750 discount.
Vehicles from other manufacturers will receive a reduced grant of £1,500. This strategy is designed to not only promotes greener production methods within the automotive sector but also provide UK consumers with a tangible way to support cleaner supply chains.
Broader Government Strategy
The reintroduction of this grant is part of a comprehensive government strategy aimed at achieving net-zero targets and facilitating the 2030 phase-out of new petrol and diesel vehicles. This initiative is complemented by over £63 million in new funding for public, home, and workplace charging infrastructure, which will help alleviate "range anxiety" and enhance access to charging stations across the nation.
Read more about other EV related announcements:
A £63 Million boost for Britain's Electric-Car Revolution
Powering Britain’s EV Future: DRIVE35
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."
Find out more about the UK Government's revived Electric Car Grant scheme: