The Transport Secretary today (15 July 2025) announced a £650 million grant scheme worth up to £3,750 per car.
The £650 million Electric Car Grant (ECG) will back UK and other manufacturers, with eligibility dependent on the highest manufacturing sustainability standards.
Discounts of 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 apply for their zero-emission cars to be part of the grant scheme from 16 July 2025, with funding available until the 2028 to 2029 financial year.
With drivers citing upfront costs as a key barrier to adoption, the grant will narrow the upfront cost between petrol and electric vehicles, giving drivers access to savings of up to £1,500 a year in fuel and running costs compared to a petrol car.
The discount means that zero-emission cars are now cheaper to buy and run than ever before and comes on top of preferential tax rates.
Owning and buying an electric vehicle (EV) is becoming cheaper, with 2 in 5 used electric cars sold at under £20,000 and 33 brand-new electric cars available from under £30,000.
This latest investment is part of the government’s plan to support motorists, including a record £1.6 billion invested to tackle potholes and freezing fuel duty at 5 pence until spring 2026, saving the average motorist £50 to £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 charge points 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 charge points at business depots across the country.”
In total, the government is investing £4.5 billion to turbocharge the switch to EVs.
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 charge points 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.
