The £5000 grant towards buying an electric car, which the Labour government said would be introduced in January 2011, has still not been confirmed by the new coalition government.
Vince Cable, Business Secretary, was expected to confirm that this grant would still be going ahead at today’s Society of Motor Manufacturers and Traders’ (SMMT) second International Automotive Summit in London.
However instead he stated that he could not confirm when the government would make a decision about the grant. He said that Philip Hammond, Transport Secretary, would be responsible for the decision.
In the meantime the car industry has made plans about timescales for introducing electric cars into the UK based on the expectation that the grant would go ahead, as promised by Labour.
The car industry is not likely to be happy if the grant is now removed after making investments in this area. At the very least, the industry will want a clear decision by the government as soon as possible.
One option is that the grant is still introduced, but at a lower rate than that promised by Labour.
Vince Cable also said today that the new government is not likely to offer direct aid subsidies to the car industry in the same way that Labour was prepared to consider.
Nissan is planning to build the electric LEAF at its plant in Sunderland and Vauxhall is hoping to build the extended-range electric Ampera at Ellesmere Port, but both companies want a UK environment that is supportive of electric cars before they build the vehicles here.
Other European countries, and America, are introducing grants to incentivise early adoption of electric vehicles.
Delegates at the SMMT International Automotive Summit debated the future of the UK motor industry, its role in supporting a better balanced economy and the growth opportunities available through the shift to ultra-low carbon technology.
Update – 28th July 2010 – Finally, the £5,000 electric car grant is confirmed , says it will be available across the UK, it will be open to both private and business fleet buyers from January 2011.