Coronavirus’s impact on car industry What the shutdowns mean for car makers, dealers and car buyers alike

Plug-in car grant to continue, plus more charging points

THE GOVERNMENT HAS announced new funding for electric vehicle (EV) charging, pothole filling and road improvements as part of its annual March budget.

In his first budget as chancellor, Rishi Sunak announced a new package worth £27 billion for strategic road improvements over the next five years, including an extra £2.5bn to repair 50 million potholes. He said the announcement represented the largest investment to date in the transport sector.

Sunak announced a new, £500m funding pot, to be spent over the next five years, to help grow the UK’S rapid charging network for EVS. The intention is that drivers will never be more than 30 miles from a rapid charging point. The fund is primarily designed to cover the cost of businesses installing fast chargers on their premises.

In addition, the current grant for those buying an EV, which was due to run out at the end of this year, has been extended to 2023 in a move worth £403m. However, the grant has been reduced to £3000 from £3500. In addition, the grant is no longer available on cars that cost more than £50,000.

The budget confirmed that EVS will be exempt from the so-called ‘luxury car supplement’, which can add up to £1600 in road tax over five years on cars costing more than £40,000.

Pothole repairs were also given a boost, with the setting up of a fund for repairs worth £500m over five years. That money falls well short of the estimated £9.8bn needed to completely fix Britain’s potholes.

Local councils filled in more than 15,000 potholes in 2018-2019, but more than 700,000 potholes were reported in the 2018 financial year alone. Additionally, more than £1.9m was paid out in compensation claims to motorists who had their cars damaged by potholes. The average claim was for £257.

Sunak also announced an end to tax relief on red diesel in all sectors except agriculture, fish farming and non-commercial heating. Buyers of red diesel currently pay 11 pence per litre of tax on fuel, compared with 58 pence for regular buyers. Sunak said sectors using red diesel contribute heavily to the UK’S emissions.

Red diesel is the same as regular diesel but is used in vehicles that aren’t taken on the road – for example, tractors and other agricultural or construction vehicles.

28 May 2020