THE government’s decision to end a €3,800 incentive for companies to buy an electric car is mystifying the motor industry – especially in view of plans to have a million EVs on the road by 2030.

The announcement that the €3,800 SEAI grant is being cut for company cars is the first major example of government support being modified in line with increasing EV sales.

It takes effect in two weeks.

Environment Minister Richard Bruton believes the decision won’t affect company-car buying because the ‘whole life’ costs of EVs are still so attractive. But key motor industry personnel are scratching their heads in bewilderment at the U-turn this morning.

Mr Bruton said: "As the whole life costs of EVs reduce, the targeting of Government grant support must be adjusted to reflect this. Accordingly, the grant of up to €3,800 for businesses purchasing an electric car will be discontinued; the generous benefit-in-kind tax relief that is available for these vehicles is considered adequate incentive to drive growth in this sector."

The €3,800 grant was in conjunction with a €5,000 VRT rebate which continues until the end of 2021 at least.

On a more positive note, Mr Bruton said €14m in extra funding for EVs will ensure the €5,000 grant for private electric-car buyers (€3,800 for company vans) will continue.

But, in another tightening of requirements, it emerged that the range and emissions standards for plug-in hybrid electric vehicles (PHEVs) will also be changed.

Minimum battery range goes up from 20km to 50km and the maximum emissions drop from 65g/km to 50g/km. That will hit older PHEV models especially.

The changes apply to all grant applications received from October 23. That gives buyers two weeks to apply for purchase grants under the existing rules – so long as the vehicles are licensed and the grant claimed before the end of 2019.

Online Editors