How can we make EVs more attractive to more households?

EVA England has worked with Cambridge Economics and Transport & Environment to understand what influences drivers’ car buying decisions

On the face of it, the transition to electric driving is gathering pace. In February this year, a quarter of new cars sold were fully electric, and there are now nearly 1.9million EVs on UK roads.

However, that still represents only 5.5% of the UK car parc. Barriers such as upfront cost still present a significant hurdle for many considering the switch to electric: half of EV drivers responding to our EVA England surveys found purchasing their electric car substantially more expensive than their previous petrol or diesel car, and amongst non-electric drivers, 46% still find the upfront purchase price of EVs prohibitive.

Driving electric remains the preserve of higher income households: over 9 in 10 EV drivers have access to a driveway or private parking, and less than 28% of drivers responding to our 2025 annual survey had incomes under £50,000.

The EV transition cannot just be about chasing targets and numbers. For it to be a success, and for it to be sustainable, we need to create an attractive sector that is affordable to all households, whatever their circumstance.

Government incentives, in the form of the Electric Car Grant (ECG) and the favourable Benefit in Kind rates that support EV salary sacrifice schemes, are targeted at the new EV market. But focusing incentives solely, in their current form, at that market will not help the majority of households: those on low and middle incomes tend to buy on the used car market or lease, and are often in employment that does not allow them to take advantage of salary sacrifice schemes.

And we know that the used EV market is not yet an attractive offer for these households: whereas 75-80% of the full driving community buy used, less than 25% of EV drivers do.

Access to Low Cost Electric Cars and Vans, a new report produced by Cambridge Econometrics on behalf of EVA England and Transport & Environment, takes a vital and fresh look at whether existing incentives can be re-focused to make EVs more attractive to lower and middle income households and offers up recommendations to government on what else can be done to make sure that driving electric is a genuine choice for all of us.

What are the main barriers to overcome and can existing incentives work against these?

The report highlights the three key barriers preventing lower and middle income households from accessing EVs:

• High upfront costs
• Poor knowledge of the cost structure of EV ownership, coupled with uncertainty around it
• A lack of affordable public charging infrastructure for those without access to private charging.

The report sheds light on the fact that existing government incentives, as currently structured, are unlikely to be able to support these households in making the switch to electric.

Electric Car Grant

Lower income households typically spend between £50–100 a month on motoring costs and predominantly buy used EVs. The current levels of discount for the Electric Car Grant (ECG) are £3,750 and £1,500 depending on the model eligible. The price difference between the cheapest ECG-eligible new car, and the cheapest new petrol or diesel car is £5,320.

For the ECG to be able to help these households buy the cheapest new EV at a comparable cost to the cheapest ICE, the discount would need to be nearly double what it is now, and even more to achieve price parity with second-hand ICE cars. This would mean spreading the grant across far fewer transactions, making it far less effective. 

Salary sacrifice

The cheapest EV lease currently sits at £141 a month – higher than lower income households typically spend each month on their motoring costs. Salary sacrifice schemes currently work only for higher income employees (the average salary for an EV salary sacrifice scheme is estimated to be £42, 691) and salaried employees (rather than those paid hourly, self-employed or on zero hours contracts), meaning many households simply cannot take advantage of these schemes as a way to access the EV market. 

On-street residential charging

Government funding has been focused on getting more chargepoints in the ground – vital for those without access to private parking and charging – primarily through the Local EV Infrastructure Fund.

However, whilst this has been a success story, with over 118,000 connectors now available to consumers, there are regional imbalances, and wider energy regulatory decisions have driven up chargepoint prices to levels that are unaffordable for many.

Some 50% of EV drivers without access to private charging find it more expensive to run their EV than their previous petrol or diesel vehicle.

How should available government funds be targeted to increase EV affordability to all households?

The report makes three key recommendations. They were tested with EVA England members who, as EV consumers, found them attractive, offering a new way of thinking about how to unlock the barriers preventing many from making the switch.

In the short term, re-targeting the additional £1.3bn for the Electric Car Grant announced at the 2025 Autumn Budget to offer a subsidy to lower and middle income households of around £100 a month for an extended pure social lease or a bundled all in one leasing package, that also includes charging credits, would open the EV market up to households in the bottom 50% of the income distribution.

A variety of options can be used to identify eligible households, for example, those receiving Universal credit, key workers, setting income thresholds, or a combination of these.

The government’s current cost of public charging review must also deliver urgent action to bring down prices for consumers at the chargepoint. This is not just about the potential for VAT equalisation – though that may play a role, its impact on what can be a 70p per kWhr difference in charging price is likely to be small; this is about structural reform that will deliver significant drops in price and about considering innovative ways to help low and middle income households with their costs of charging. It is only by making sure EVs are affordable to all households, whatever their income or personal circumstance, that the long term sustainability and success of the EV transition will be achieved.

• Pure Social Leasing: Bringing leasing costs down below £100 a month, by offering a monthly subsidy, and extending lease durations to reduce depreciation costs over the length of the lease and give households longer term certainty over costs, would open up the EV market to a much wider range of potential EV customers.
• Bundled Social Leasing: Most non EV drivers see only the upfront purchase price for EVs – they don’t understand that running costs and maintenance costs can be lower. Our surveys show that 48% are still concerned about battery range, and 29% believe EV charging infrastructure is difficult to use. Creating a market (through regulation or partnerships with charities or social enterprises) for all-in-one packages covering the car lease, insurance, maintenance and charging costs (which could be in the form of charging credits for particular providers) could go a long way to simplifying the process of switching to EV and attracting more drivers.
• Scrappage-For-Leasing:Targeted schemes that allow drivers to trade in older, polluting petrol or diesel cars for a scrappage bonus, which is applied as a discount for a new EV lease.

Vicky Edmonds is chief executive of EVA England