Would you swap to an electric car if they were £6,000 cheaper?

Would you swap to an electric car if they were £6,000 cheaper? Boris may slash the price of zero-emission vehicles for those who ditch petrol or diesel

• Government could announce a scrappage scheme for only electric vehicles
• Motorists who scrap an old petrol or diesel car would get £6,000 off a new EV
• Plans could be announced next month, according to report from The Telegraph 
• It mirrors plans in Germany that are part of a €130bn Covid-19 stimulus package 
• EV buyers there will receive an industry and government-backed subsidy of €9k

Motorists could soon be given £6,000 by the government if they agree to scrap their existing petrol or diesel car and buy a new electric vehicle, according to reports.

The plans, which could be announced as early as July, would be part of Prime Minister Boris Johnson's plans to relaunch the economy - following in the footsteps of a similar proposal set out in Germany's €130bn coronavirus recovery plan.

It could mean that the price of the British-build Nissan Leaf electric vehicle falls from £26,845 to just £20,845 and would see a new VW ID.3 zero-emission hatchback cost around the same as an entry-level petrol-powered Golf.

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Would you buy an electric car if they were £6k cheaper? Prices of EV models like the Renault Zoe, Nissan Leaf and Tesla Model 3 could be lower if you scrap an old petrol or diesel motor, according to new reports

The Telegraph, which broke the story on Sunday night, said the £6,000 subsidy for pure electric vehicles could be announced as part of Boris Johnson's major speech to relaunch the economy that is pencilled in for Monday 6 July.

The deal would operate in a similar way to the Government-backed scrappage scheme in 2009, which was launched after the financial crisis to reinvigorate car sales and consumer spending.

That scheme - reducing the price of any new car by £2,000 when motorists scrapped their old one - saw around 400,000 new cars being bought in the UK while it was available.  

Industry insiders have been calling for an incentive to help the car industry recover from the coronavirus, with the lockdown forcing motor dealerships to close for two months and saw registrations of new cars plummet by 97 per cent in April and 89 per cent in May to the lowest levels since the end of the Second World War.

The Prime Minister would also see the move as a positive break for UK manufacturing, with the popular Nissan Leaf build at the Japanese firm's factory in Sunderland and Mini's Plant Oxford producing the all-new Mini Electric. 

Jaguar Land Rover has also set out plans to increase its electric vehicle offering, having already brought plug-in hybrid models to the market - though the firm's only pure-electric car so far is the Jaguar I-Pace SUV, which is built in Graz, Austria. 

Such a move would be a huge milestone for the sector as it would bring price parity for electric cars compared to models with internal combustion engines for the first time in the UK.

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The move would be a boost for UK manufacturing as well as the wider automotive industry, with cars like the Mini Electric build in Britain. Pictured, the new zero-emission Mini with a range of 124 miles driving through the Plant Oxford factory

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One of the UK's best-selling electric cars - the Nissan Leaf, pictured - is also built in the UK, at the firm's plant in Sunderland

The new Nissan LEAF will come with this e-pedal technology

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With a £6,000 subsidy, the price of the new Volkswagen ID.3 (pictured) would fall to around the same price as a petrol-powered entry-spec Golf hatchback 

For instance, the price of a Nissan Leaf would drop to around £20,000, which will be on par with the Nissan Qashqai, starting from £20,565 in the UK.

The all-new £24,400 Mini Electric would fall to just £18,400 - a like-for-like fee as a petrol Mini Cooper.

Tesla's most affordable Model 3 would decrease from around £40,000 to £34,000, around the same a a mid-spec BMW 3 Series saloon.

Volkswagen's new ID.3 is also due to hit showrooms in 2020, priced at around £27,500. A £6,000 subsidy when a motorists scraps their old car would see this price fall to the same level as the cheapest Mk8 Golf hatchback with an internal combustion engine.  

It is already know the government and the UK trade body, the Society of Motor Manufacturers and Traders, have been in communication regarding the relaunch of a scrappage scheme to help boost demand for new cars following the pandemic.

What the SMMT has said about a potential scrappage scheme 

Mike Hawes, SMMT chief executive, said in a statement last week: 'The lockdown has had a significant impact on many automotive businesses, lives and livelihoods, with closures resulting in a total collapse of sales and production. 

'Like many sectors, we have been in constant communication with Government, highlighting the situation and what support might be needed when the immediate crisis eases. 

'Showrooms opened in England yesterday [Monday 1 June] and reports so far suggest a positive response from consumers. 

'However, while there will be some pent up demand, the effect on underlying consumer confidence will be unclear and we may need to work with government to identify ways of boosting demand, especially given the contribution this sector makes to the economy and jobs. 

'That time is not now but industry, and government, need to be prepared for all eventualities.'

However, a leaked letter seen by The Guardian sent from SMMT chief executive Mike Hawes to Chancellor Rishi Sunak said that any 'market stimulus package' would need to encourage the purchase of diesel and petrol cars on an equal footing with cleaner vehicles - despite the government's push for drivers to switch to electric cars.

In a letter seen by the paper that was sent to the chancellor and the business secretary, Alok Sharma, the SMMT boss said a scheme would need to 'support the entire market, not just disproportionately favouring specific segments or technologies, recognising the diverse nature of UK automotive manufacturing'.  

The Government is more likely to favour a scheme targeted at zero-emissions models as it would be seen to fit with the commitment to ban the sale of all new petrol, diesel or hybrid cars by 2035 - as well as the significant investments in boosting electric car uptake announced earlier this year.

This includes a £1billion package for green transport solutions confirmed in the Budget in March, which included £500million to support the roll-out of new rapid charging hubs and the extension of the Plug-in Car Grant.  

It is unclear if the PICG - already cutting the price of EVs by £3,000 - would continue to be available if the scheme was launched. If so, the retail price of a qualifying electric model would be £9,000 lower than the quoted RRP.

The move would also mirror similar plans outlined in Germany last week.

Included in Angela Merkel's €130 billion (£116.7 billion) stimulus package to speed up Germany's recovery from the coronavirus is a government and industry-combined incentive of €9,000 towards plug-in passenger cars costing less than €40,000.

Manufacturers are already offering to reduce the price of a new plug-in vehicle by €3,000 in the country, and the government will add another €6,000 to make electric cars more appealing to customers. 

In Germany from 2021 there will also be a new staggered tax on vehicles that emit more than 95g/km CO2 - aimed at gas-guzzling SUVs - and all petrol stations in the country will also need to have electric car charging points.