UK government may pay drivers up to £6,000 to replace petrol and diesel cars with electric vehicles

The UK government may pay drivers up to £6,000 to replace their petrol and diesel cars with electric vehicles in a bid to kickstart economic recovery after COVID-19.

Plans for the incentivisation scheme are being considered by PM Boris Johnson in the run up to a speech on relaunching the economy, the Telegraph reported. 

The ‘cash for clunkers’ program, would help the UK meet its goal of phasing out fossil fuel car sales by 2035 and would be accompanied by investment in charging ports. 

According to the Telegraph, Mr Johnson will give his speech on the UK’s economic recovery in the wake of the COVID-19 crisis on July 6 — and will be followed by a statement from Chancellor of the Exchequer Rishi Sunak.

The car-exchanging programme reportedly takes its inspiration from then-Chancellor Gordon Brown’s move to offer tax breaks for diesel cars — intended to reap the benefits of lower carbon dioxide emissions — back in 2001.

Electric vehicles are key to the forward-looking manufacturing strategies of three of the biggest automobile producers with factories based in the UK — including BMW, Jaguar Land Rover and Nissan — which the Government is keen remain open. 

Nissan, for example — whose Leaf electric vehicle is manufactured in a plant in Sunderland — typically produces some 500,000 cars in the UK each year, an output which is key to supporting the economy of the north-east of the country.

However, the factory’s future has grown precarious with the double-hit of both Brexit — with Nissan saying continued operations would be ‘unsustainable’ without a deal — followed by the present global health crisis.

The move to trade in fossil-fuel-powered cars for electric vehicles would help to stimulate car sales, which have fallen by nearly 90 since the instigation of the lockdown measures intended to curb the spread of COVID-19.

According to the Telegraph, ministers are hopeful that the trade-in scheme could entice Nissan part-owner Renault to increase production of its new Zoe electric car at the Sunderland site as it tries to conquer the UK electric vehicle market.

In addition, the scheme may aid the UK’s plans to ban the sale of new fossil-fuel-powered cars by the year 2035 by giving the country’s burgeoning electric vehicle market a boost.

The trade-in program may, in particular, attract those consumers tempted by the lower running costs associated with electric cars but put off by the initially higher up-front prices.

The scheme — dubbed ‘cash for clunkers’ — would also be accompanied by a £1 billion investment in electric vehicle charging points across the UK, with the aim of making long journeys in electric vehicles more practical, the Telegraph reported.