If you’re thinking about buying an electric car, you might be in luck. A new £650 million government grant has just been announced, offering drivers up to £3,750 off the price of a new battery electric vehicle (BEV).
This could be great news for private drivers, business owners, and grey fleet drivers – anyone who uses their own vehicle for work – looking to cut upfront costs and switch to cleaner transport.
Let’s break down what the Electric Car Grant (ECG) involves, who qualifies, and how to make the most of it.
What Is the Electric Car Grant?
The Electric Car Grant is a new initiative from the Department for Transport and the Office for Zero Emission Vehicles, starting on 16 July 2025.
It aims to make zero-emission vehicles more accessible by offering a discount at the point of sale on qualifying new electric cars.
How much is the discount?
- Up to £3,750 for vehicles that meet the highest sustainability standards
- Up to £1,500 for others that still meet key criteria
What qualifies?
To be eligible, the vehicle must:
- Be fully electric (BEV)
- Have a recommended retail price (RRP) of £37,000 or less
- Be manufactured by companies with a verified science-based target (SBT) and meet embodied carbon benchmarks
Notably, UK-made vehicles like the Nissan Leaf will be treated the same as other brands — all models are assessed under the same sustainability framework.
When Can You Get the Discount?
The scheme opens to manufacturers on 16 July 2025. Once a model is approved, eligible buyers will get the discount immediately at the dealership or point of sale.
New Government Support for NHS Electric Fleets
Alongside the Electric Car Grant, the government has also announced £8 million in funding to support electric ambulance and NHS fleet vehicles at over 200 sites across the UK.
This is part of a wider £63 million infrastructure package, including:
- £25 million to help local councils roll out cross-pavement charging (for households without driveways)
- £30 million for fleet depot charging upgrades
These efforts aim to support wider EV adoption across both public and private sectors.
A Grey Fleet Opportunity
If you drive your own car for work purposes – also known as the grey fleet – this new grant is worth considering.
Why it matters:
- The upfront discount can help reduce the cost of switching to a new EV
- You’ll likely save on fuel and maintenance costs
- As EVs become more common in workplace travel policies, making the switch could help you stay compliant and cut your carbon footprint
If you manage grey fleet drivers, now is a good time to review your fleet policy and encourage more sustainable choices.
What It Means for Businesses and Fleets
Fleet and leasing providers welcome the grant, especially for stimulating the retail market, which has struggled compared to business EV uptake.
However, industry experts warn that the scheme should be matched with support for the used market, to avoid pushing residual values even lower.
With government ZEV (Zero Emission Vehicle) Mandate targets tightening, the grant may help more businesses meet their fleet sustainability goals – but long-term planning is still essential.
FAQs About the Electric Car Grant
Who can get the £3,750 discount?
Anyone buying a new EV under £37,000 that’s part of the approved grant scheme.
When can I get the discount?
From 16 July 2025, when manufacturers start listing their eligible vehicles.
Can I use the grant on a used electric car?
No – it’s only for new battery electric vehicles.
Will the grant affect road tax or other costs?
Vehicles over £40,000 are still subject to the expensive car supplement: an extra £425 per year for five years, starting from year two.
FAQs About Fleet Service GB
What is Fleet Service GB?
We’re a UK-based fleet management provider, offering tools and services to help businesses run safe, efficient, and cost-effective vehicle operations.
Can you help with grey fleet compliance?
Absolutely. We offer digital solutions to manage grey fleet risks, including driver checks, mileage tracking, and cost control.
What services do you offer for fleets?
We offer maintenance management, accident support, compliance tools, and more – tailored to your business.
Final Thoughts
With the return of a government-backed discount of up to £3,750, the cost of going electric has just dropped for thousands of drivers.
While there are still some uncertainties – like used EV values and charging access – this scheme could be a great opportunity for both private drivers and grey fleet users to explore electric vehicles.
If you’re considering making the switch, or want help managing your electric or mixed fleet.
