UK's 10% discount on electric vehicles might not significantly increase sales, according to evidence

By Tom Stacey, Senior Lecturer in Operations and Supply Chain Management at Anglia Ruskin University

The transition to electric vehicles (EVs) in the UK is gaining momentum, but several challenges remain. While the UK government aims to meet its net-zero targets by 2050, the recent subsidy for EVs overlooks some fundamental barriers to wider adoption.

One of the most significant obstacles is the public's perception of EVs. A 2022 study of Norwegian EV owners highlighted concerns about limited range and the availability of public chargers, issues that continue to affect the UK market. Despite this, 80% of Norwegian EV owners reported higher satisfaction compared to owners of combustion-engine vehicles.

The UK government's target of 300,000 chargers by 2030 will not be met due to the promised investment. The UK's public charging network is a mess, according to an EV driver of over 12 years. In contrast, Norwegian retail parks now have upwards of 30 EV chargers, compared with maybe two-to-four chargers in UK retail parks.

The UK government's subsidy aims to make EVs easier and cheaper to own than petrol cars. However, EV owners in the UK can pay up to ten times more for charging on the road than at home due to the 20% VAT rate on public charging. To re-energise the EV market, the government should consider capping public charging costs and levelling VAT on charging across the board.

Another issue is the limited uptake of EVs by private buyers. Only one in ten new EV sales are to private buyers, while the majority are to company car fleets. To encourage more private purchases, the government could extend tax cuts for fleet purchases to private buyers.

The UK's sales mandates and the 2030 petrol and diesel car ban are pushing manufacturers towards selling EVs. Tesla still tops EV sales in the UK, despite recent backlash against its owner, Elon Musk. However, the public is buying only a tiny proportion of the new EVs in showrooms.

The car industry has been lobbying for EVs to be made cheaper, as they will be barred from selling new petrol and diesel cars after 2030. The UK government is offering a 10% taxpayer-funded discount on new plug-in cars that cost less than £37,000. However, many Chinese EV imports are excluded from the UK's subsidy due to high coal use in their generation of electricity.

The UK government's investment in expanding charging infrastructure is commendable. For instance, the German government has invested significantly in expanding charging infrastructure for electric vehicles, including around €2.3 billion for the "Deutschlandnetz" project aiming to create 9,000 additional fast-charging points by 2026. However, challenges remain due to market uncertainties and because investments are a risky long-term bet on future growth in electric mobility.

In Norway, 96% of new car sales are electric, a result of consistent policies since the 1990s aimed at changing perceptions. Research published with colleagues in 2025 found that tax incentives that encourage businesses to add EVs to their fleets were extremely effective.

In conclusion, while the UK is making strides in its transition to electric vehicles, several challenges remain. The government should address public concerns about range and charging infrastructure, encourage private purchases, and consider extending tax cuts to private buyers. By addressing these issues, the UK can accelerate its transition to a sustainable future.

UK's 10% discount on electric vehicles might not significantly increase sales, according to evidence