The British Prime Minister Boris Johnson is considering a premium of up to £6,000 for the exchange of a diesel or petrol car for an electric vehicle with an official announcement expected on 6 July. There are also rumours that Tesla might plan a Gigafactory on the Isles.
But first to the rumours from No. 10 Downing Street that rely on a report by the Telegraph. The British paper says it is understood that Prime Minister Johnson had set a date on 6 July for a “major speech” to layout plans for the economic recovery to follow the fall-out of the coronavirus crisis. Also, Rishi Sunak, the Chancellor, is expected to make a statement on the economy shortly afterwards.
According to the report, which has also been featured on Reuters, drivers will be given up to £6,000 to swap their petrol or diesel cars for electric ones. The measure would not affect the Plug-in Car Grants that the government had recently extended until 2023. Back then, the extension came with a reduction of the grant to £3,000 from the previous £3,500, and this only for electric cars up to a list price of £50,000. Despite the designation, plug-in hybrids have been virtually excluded from the PiCG subsidy since the first reform in 2018 (the minimum range is 70 miles), which applies practically only to BEV and FCEV.
The move on ICEs now expected from PM Johnson is designed to provide a shot in the arm for UK electric car manufacturing and the car industry as a whole. It follows similar initiatives in for example Germany. There the Government around chancellor Angela Merkel had doubled its share of the plug-in car grants to 6,000 euros and at the same time excluded petrol-powered vehicles from any purchase premiums.
The rumours around the UK scrappage plans comes as Business Secretary Alok Sharma announced the creation of five new business-focused groups to “unleash Britain’s growth potential and create jobs” as part of the British bounce-back plan.
Also helpful, if it proves more than a coincidence, would Tesla be setting up shop on the island. Reports in the Times and Independent suggest Elon Musk had flown into Luton airport earlier this month to explore the potential for a Gigafactory near Bristol, in the South West of England.
The reports also mention that the UK Government’s Department of International Trade had recently been on the lookout for a 4 million sqft. commercial premises. More specifically, it is alleged such a large plot could be used for a Gigafactory for manufacturing electric cars and batteries.
The Tesla CEO had initially mentioned Britain when on the lookout for a place in Europe. However, he had also cited Brexit uncertainty before deciding to build the Giga Berlin electric car factory in Germany.
So far, neither Tesla nor the Government has been available to comment.
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