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UK cuts electric car subsidies.

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redsturgeon
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UK cuts electric car subsidies.

#396688

Postby redsturgeon » March 18th, 2021, 11:03 am

https://www.theguardian.com/environment ... le-support

This seems like an oddly timed move.

John

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Re: UK cuts electric car subsidies.

#396694

Postby dealtn » March 18th, 2021, 11:12 am

redsturgeon wrote:https://www.theguardian.com/environment/2021/mar/18/uk-slashes-grants-for-electric-car-buyers-while-increasing-petrol-vehicle-support

This seems like an oddly timed move.

John


I haven't read the article but I am minded to agree. Most moves to reduce or eliminate government subsidies come too late, or shouldn't have been introduced in the first place.

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Re: UK cuts electric car subsidies.

#396704

Postby JohnB » March 18th, 2021, 11:41 am

Clearly most people can't expect to get a subsidy on their car purchase, as BEV prices track towards ICE prices, it seems sensible to reduce it, and £500 won't really change anyone's decision. Better handled than solar panels.

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Re: UK cuts electric car subsidies.

#396840

Postby AF62 » March 18th, 2021, 5:03 pm

redsturgeon wrote:https://www.theguardian.com/environment/2021/mar/18/uk-slashes-grants-for-electric-car-buyers-while-increasing-petrol-vehicle-support

This seems like an oddly timed move.

John


Seems quite sensible to me. Subsidising £50k cars - why? If someone wants an EV there are plenty around now that fall below the new £35k linit.

And that is before you get to the question of whether the price of EVs is being inflated by the grants available. What is the 'real' price of an EV given that nobody buys one without a grant. It is the price really £35k but the consumer pays £32k or is it actually £32k and the £3k is just added profit for the manufacturer.

I am due to take delivery of a new EV in the next couple of weeks and have been sorting out a charger. I can buy an Ohme charger for £200 which I would need to get an electrician to wire in (so labour, an earthing rod, cable, etc) - but buying that way means the installation doesn't qualify for the £350 OLEV grant.

Or I can get an EV chargepoint installer to install the same Ohme charger which will be eligible for the grant but they will charge £648 for the Ohme charger plus the same labour and parts if I bought the unit directly.

Hmm, get a £350 grant but the unit costs £450 more - something smells fishy and that smell is the government being done over like a kipper.

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Re: UK cuts electric car subsidies.

#396845

Postby Arborbridge » March 18th, 2021, 5:11 pm

Well, who can justify buying an electric car anyway. It is a worthy thing to do, but not financially viable for most people as yet. We'll keep our petrol car for as long as possible - it's dead cheap to run and owes us nothing after 16 years. Our diesel Merc is a delight to drive and there's absolutely no reason to swap it and pay through the nose for anything other than something similar.


Arb.

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Re: UK cuts electric car subsidies.

#396856

Postby AF62 » March 18th, 2021, 5:30 pm

Arborbridge wrote:Well, who can justify buying an electric car anyway. It is a worthy thing to do, but not financially viable for most people as yet.


Depends if you are driving a car that has hit the bottom in depreciation or not.

Arborbridge wrote: We'll keep our petrol car for as long as possible - it's dead cheap to run and owes us nothing after 16 years.


Ah, you are :D

For those running cars which are still depreciating then then cost between ICE and EV has narrowed significantly and for many is now in favour of EVs, but that is mainly because of the absence of taxation on the fuel - £1,250 for 8000 miles in a petrol car or less than £100 in an EV, plus saving a £150 or so in road tax.

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Re: UK cuts electric car subsidies.

#396861

Postby Arborbridge » March 18th, 2021, 5:46 pm

AF62 wrote:
Arborbridge wrote:Well, who can justify buying an electric car anyway. It is a worthy thing to do, but not financially viable for most people as yet.


Depends if you are driving a car that has hit the bottom in depreciation or not.

Arborbridge wrote: We'll keep our petrol car for as long as possible - it's dead cheap to run and owes us nothing after 16 years.


Ah, you are :D

For those running cars which are still depreciating then then cost between ICE and EV has narrowed significantly and for many is now in favour of EVs, but that is mainly because of the absence of taxation on the fuel - £1,250 for 8000 miles in a petrol car or less than £100 in an EV, plus saving a £150 or so in road tax.


And the difference in capital cost? And lugging around batteries, taking up space and needing replacement? And the short range? And the lack of charging points? There's a long way to go before the majority re convinced.
I just can't see the reason for not buying another diesel, or petrol - though admittedly a Hybrid might have some appeal.

Arb.

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Re: UK cuts electric car subsidies.

#396865

Postby JohnB » March 18th, 2021, 5:58 pm

The government subsidy is pump priming, not a bribe to get everyone to switch now. It just needs to ensure sales match manufacturer capacity as both climb rapidly. It needed to be high to get the first 0.1% of sales to switch, it needs to be gone by the time 10% of sales are BEV (and indeed could be a penalty for the last 10% of ICV sales). Ditto home charging points.

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Re: UK cuts electric car subsidies.

#396867

Postby AF62 » March 18th, 2021, 6:07 pm

Arborbridge wrote:
AF62 wrote:
Arborbridge wrote:Well, who can justify buying an electric car anyway. It is a worthy thing to do, but not financially viable for most people as yet.


Depends if you are driving a car that has hit the bottom in depreciation or not.

Arborbridge wrote: We'll keep our petrol car for as long as possible - it's dead cheap to run and owes us nothing after 16 years.


Ah, you are :D

For those running cars which are still depreciating then then cost between ICE and EV has narrowed significantly and for many is now in favour of EVs, but that is mainly because of the absence of taxation on the fuel - £1,250 for 8000 miles in a petrol car or less than £100 in an EV, plus saving a £150 or so in road tax.


And the difference in capital cost? And lugging around batteries, taking up space and needing replacement? And the short range? And the lack of charging points? There's a long way to go before the majority re convinced.
I just can't see the reason for not buying another diesel, or petrol - though admittedly a Hybrid might have some appeal.

Arb.


Capital cost - I am leasing a new EV for a couple of years and the cost (effectively depreciation + cost of money) is not wildly different between petrol and electric, but the running costs as mentioned before are far far lower with the EV, so the total cost of ownership will be far cheaper than if I bought/leased an equivalent petrol car.

Lugging around batteries - do you worry about lugging around petrol? Do people who drive 'chunky' SUVs worry about the excess metal they are carrying around when they could be in a lighter normal car?

Taking up space - Plenty of space in the car. EVs are now being designed with the batteries below the floor so the batteries no longer take up any space in the boot.

Needing replacement - As I am leasing I don't care how long they last, but the fear of batteries wearing out has been disproved as a myth with lots of manufacturers offering long warranties on the battery.

Short range - It is a second car so won't be used for long distance journeys, although not that I usually make many of those, so the 250 mile range will be fine for me. Mostly 5 miles here, 5 miles there, a weekly 60 mile round trip, a few 20 mile trips - all will be well within its means.

The lack of charging points - there will be one at my house which will cover the vast majority of my needs, but plenty of pay or even free chargers in the local area.

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Re: UK cuts electric car subsidies.

#396869

Postby AF62 » March 18th, 2021, 6:11 pm

JohnB wrote:The government subsidy is pump priming, not a bribe to get everyone to switch now. It just needs to ensure sales match manufacturer capacity as both climb rapidly. It needed to be high to get the first 0.1% of sales to switch, it needs to be gone by the time 10% of sales are BEV (and indeed could be a penalty for the last 10% of ICV sales). Ditto home charging points.


But the subsidy is no longer a subsidy but is being exploited by the manufacturers and installers as free extra profit.

If the government wants to encourage EV take-up then the time for subsidy has already passed, what is needed now is directing the installation of the charging infrastructure.

I have a drive at my house so can install a charging point. Lots of people who want EVs have to park on the street so the government needs to direct councils and new house builders to install EV charging points in streetlamps, communal charging points, etc.

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Re: UK cuts electric car subsidies.

#396904

Postby JohnB » March 18th, 2021, 8:30 pm

There is no such thing as free extra profit. Manufacturers will undercut each other until the sale price including subsidy matches their manufacturing+distribution costs+required profit. The purpose of the subsidy is so the equation works, and they invest in production lines. In California manufacturers are given a stick, a certain percentage of cars must be zero emissions, even if they are sold at a loss. In the UK its a carrot.

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Re: UK cuts electric car subsidies.

#396915

Postby Lanark » March 18th, 2021, 9:26 pm

It's not at all likely that this is a cut, by lowering the limit from 50K to 35K there are going to be far more cars able to qualify. They should have lowered it to 25K.

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Re: UK cuts electric car subsidies.

#396920

Postby AF62 » March 18th, 2021, 9:42 pm

JohnB wrote:There is no such thing as free extra profit. Manufacturers will undercut each other until the sale price including subsidy matches their manufacturing+distribution costs+required profit. The purpose of the subsidy is so the equation works, and they invest in production lines. In California manufacturers are given a stick, a certain percentage of cars must be zero emissions, even if they are sold at a loss. In the UK its a carrot.


So if there is no free extra profit for manufacturers/ retailers from government grants resulting in inflated prices then perhaps you can explain why if I buy an Ohme EV charger without a government grant it costs £200 but with the £350 grant it costs £648. And as for competition - none of the other EV chargers that qualify for the grant are cheaper than £650.

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Re: UK cuts electric car subsidies.

#396937

Postby JohnB » March 18th, 2021, 10:54 pm

https://www.smarthomecharge.co.uk/charg ... l-charger/ £530 including installation. I guess this means buying a £200 charger themselves, working for 2 days @£350 a day and getting £350 from the government. If you find an electrician who is cheaper, why aren't they registered for the scheme, as the subsidy clearly would give them an edge getting more work.

Arbitrage.

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Re: UK cuts electric car subsidies.

#396971

Postby AF62 » March 19th, 2021, 7:03 am

JohnB wrote:https://www.smarthomecharge.co.uk/chargers/ohme/wall-charger/ £530 including installation. I guess this means buying a £200 charger themselves, working for 2 days @£350 a day and getting £350 from the government. If you find an electrician who is cheaper, why aren't they registered for the scheme, as the subsidy clearly would give them an edge getting more work.

Arbitrage.


It doesn’t take any electrician two days to fit an EV charger! It takes a competent electrician half a day to install what is little more than an outside extension socket with an earth rod.

The quote for mine was £648 for the (£200) charger, plus £60 for other materials and £180 for labour, totalling £888 less the £350 grant to reach £538. Coincidentally rather close to the same amount as the page you quoted.

All the electricians are charging the same, or even more - I had one who quoted £1,300 to install!

So what benefit is the government getting in handing out £350 wadges of cash to ‘Loadsamoney’ electricians who are inflating the cost of the work?

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Re: UK cuts electric car subsidies.

#397023

Postby Arborbridge » March 19th, 2021, 10:32 am

AF62 wrote:Capital cost - I am leasing a new EV for a couple of years and the cost (effectively depreciation + cost of money) is not wildly different between petrol and electric, but the running costs as mentioned before are far far lower with the EV, so the total cost of ownership will be far cheaper than if I bought/leased an equivalent petrol car.



Well, clearly I need to check into this, but from the numbers mentioned on here of the capital cost, it doesn's seem an option for someone with modest means. My normal routine would be to buy a nearly new middle range car (typically I'd drive a Merc A/B, BMW 3, Saab) and keep it five years or so. Meanwhile, I'd stash savings in investments to pay for the replacement and as far as I know, that is never as much as leasing would be.

PS: haven't looked a car prices for years, so perhaps I will get a shock!

Arb.

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Re: UK cuts electric car subsidies.

#397029

Postby dspp » March 19th, 2021, 10:39 am

Arborbridge wrote:
AF62 wrote:Capital cost - I am leasing a new EV for a couple of years and the cost (effectively depreciation + cost of money) is not wildly different between petrol and electric, but the running costs as mentioned before are far far lower with the EV, so the total cost of ownership will be far cheaper than if I bought/leased an equivalent petrol car.



Well, clearly I need to check into this, but from the numbers mentioned on here of the capital cost, it doesn's seem an option for someone with modest means. My normal routine would be to buy a nearly new middle range car (typically I'd drive a Merc A/B, BMW 3, Saab) and keep it five years or so. Meanwhile, I'd stash savings in investments to pay for the replacement and as far as I know, that is never as much as leasing would be.

PS: haven't looked a car prices for years, so perhaps I will get a shock!

Arb.


You could buy a Wuling Mini, if they start exporting them from China. There are rumours that manufacturing is still running at a loss on them ..........

https://twitter.com/ICannot_Enough/stat ... 70/photo/1

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Re: UK cuts electric car subsidies.

#397575

Postby Wuffle » March 21st, 2021, 7:42 am

I think everybody (nearly) knows that the bulk of electric vehicles are being, we shall say bought and sidestep the technicalities, by higher earning self emlpoyed people (electricians? haha) for the considerable tax advantages.
It is not a good look for these higher earners to be side stepping the righteous progressive tax system that is generally accepted. THIS CAR IS SUBSIDISED AND SO IS MY FUEL is pretty obvious to even the less financially literate. Amongst the financially savvy, there is an understanding that quite a bit of the progressive tax system can be held at bay but the finiancially illiterate think it is there because rich people deserve it.

W.

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Re: UK cuts electric car subsidies.

#397579

Postby JohnB » March 21st, 2021, 7:57 am

The government's aim is to get the electric car industry moving. Direct payments to manufacturers are constrained by competition rules and don't help the supply chain, so its best to inject the money at consumer level.

If you are trying to reduce the price of something expensive, then it seems inevitable the subsidy will be taken up by the rich, as only they can buy almost-expensive things. Better to offer £2k to 10 rich people to flip their decision than £20k to one poor person, especially as that does not encourage manufacturers to be nearly price competitive.

The car scrappage scheme did pay out to poor people, as they have the bangers, but while they could stretch to a new ICE car, I don't think they could to a BEV one.

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Re: UK cuts electric car subsidies.

#397588

Postby bungeejumper » March 21st, 2021, 9:00 am

Snorvey wrote:What makes an electric car so much more expensive? I mean most of the bodywork and the running gear is the same as a traditional car. Electric motors are hardly new technology and arguably of a more simple construction than some of the ICE power plants around. So is it just down to the batteries?

I wouldn't doubt that batteries are expensive beasts. Here's a discussion I read recently about VW's e-Golf in America. Broadly, they're talking about $150 to $200 per kilowatt-hour of battery resources for VW, Nissan, GM and a few other manufacturers. And then there's the fitting, and then there are the sales taxes/VAT. You do the maths. :| Wouldn't be too hard to rack up $12K/£10K by the time the car reached the consumer. https://www.myvwegolf.com/forum/viewtopic.php?t=496

BJ


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