By Alicia Tariq.
The UK government reopened the Electric Vehicle grant scheme in July 2025, where people can apply for a grant if their chosen model meets environmental standards. The scheme first opened as the ‘plug-in car grant’ but controversially closed in June 2021, even after supporting over 500,000 EV purchases.
New AutoMotive found that there were 46,000 EV registrations in the UK in June 2025. However, this is a significantly low number and the SMF (Social Market Foundation) have stated that there need to be more EV sales to meet the Zero Emissions Vehicle (ZEV) goal, and the 2030 ban on new petrol and diesel cars.
According to the Office for Zero Emissions Vehicles, two-thirds of the funding on the grant are spent on cars that may have been bought anyway without the grant in place. This may be the reason why there’s not enough EV registrations in the UK to meet climate goals, because grants aren’t targeted to those who are in need of them.
France introduced a new ecological bonus in 2024, which helped register more EV vehicles. The French government introduced social leasing policies which subsidises EV leases between €70 to €150 a month, and is a scheme targeted to low-income households in transport poverty, especially those who commute to work.
Policy Driven – Driving Change in the Automotive Sector
In the second episode of “Policy Driven,” co-hosts Mark and Tom are joined by Julia Poliscanova, Senior Director for Vehicles & Emobility Supply Chains at the Green NGO Transport & Environment in Brussels. The conversation explores Julia’s journey in transport and mobility, her academic and professional experiences in the UK, and the role Western markets like the UK and Canada play in influencing global transport decarbonisation policy.
The episode delves into the EU’s Strategic Dialogue on the Automotive Sector and the subsequent Action Plan, highlighting how current EU legislation has fallen short in incentivising gradual decarbonisation. Julia explores the pressures facing the automotive sector and emphasises the need for a comprehensive and robust approach to decarbonisation by securing and supporting the EV supply chain.
This scheme is cost effective and proven to be better than non-targeted grants because of how targeted grants support low-income households, that wouldn’t usually purchase an EV without the subsidy. The UK government could instead focus targeting their grants to those who need it instead of those who typically wouldn’t buy an EV in the first place, helping to make sure that funding is used effectively
The SMF has pressured the UK government to introduce these social leasing policies as they could potentially add 93,000 EVs per year, more than double the amount that the UK have – 46,000.
Targeted grants can address the barrier to EVs for middle- and low-income households. The social leasing scheme would allow eligible households to lease an EV for less than £100 a month for three years, with the government paying the private leasing company the difference. After the lease ends, they can either purchase the car for its remaining price or return it to the company. This scheme has worked well in France and has successfully supported those at risk of transport poverty, by making EVs more accessible and more affordable.
Previous SMF research found that five million British people are in transport poverty. Therefore, a targeted social leasing scheme could be bringing 500,000 people out of poverty with reduced transport costs.
Ultimately, France’s social leasing policy and targeted EV grants are helping more people transition to EVs, having a positive impact on household purchasing power. In order for the UK to spend funding effectively, adopting France’s grant scheme will maximise their grant’s effectiveness and target those who are in need of an EV.
