The Department for Transport closed a gap in the Electric Car Grant system that let buyers claim discounts on vehicles costing well above the intended price limit.
Starting August 29, the government introduced a hard cap of £42,000 for any vehicle seeking grant eligibility. This change cuts the number of models that can qualify for the discount program.
The Electric Car Grant was designed to support purchases of vehicles costing up to £37,000. But a gap in the policy meant that if one trim level of a model fell under that threshold, all other versions of the same car could also claim the discount – regardless of their actual price.
The Cupra Born illustrates how this worked in practice.
Three versions of the model previously qualified for the £1,500 discount. The entry-level VZ1’s starting price of £35,690 allowed the more expensive VZ2 and VZ3 trim levels to also qualify – even though they cost £37,460 and £39,210 respectively.
The government’s updated application process now states clearly: “From 29 August 2025 interpolation family variants will have a price cap of £42,000. Any vehicle with a purchase price over £42,000 after this date isn’t eligible for grant support.”
Grant Structure Remains Unchanged
The Electric Car Grant offers two discount levels – £1,500 or £3,750 toward the purchase price of a new EV. The £650 million fund responds to industry requests for government support to increase consumer interest in electric vehicles.
Thirty-one models have gained approval for the scheme so far.
Only two vehicles – both Ford models – have qualified for the higher £3,750 grant level.
“The Electric Car Grant is putting money back in people’s pockets whilst also providing a vital boost for industry,” a DfT spokesperson said. “The maximum price limit ensures only eligible cars priced at the lower end of the market can qualify for the discounts, ensuring government support is targeted.”
The change affects how manufacturers position their model lineups for grant eligibility. Previously, companies could offer premium trim levels under the grant program as long as they maintained one basic version below the price threshold.
