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Toyota has been working on battery technology for decades due to its investment in hybrid technology. Its engineers expect to be able to cut battery prices for electric vehicles (EVs) by 50 per cent in the second half of the 2020s. Good news for the future but, for now, the Government needs to ensure electric cars are not just the transport of the well-off. If its goal of 840,000 electric cars on our roads by the end of 2030 is to be achieved, then the mass market needs to be encouraged to move to EVs – and supported to do so.
History shows that when it comes to purchasing cars, price matters. Changes to the tax regime in 2008 caused a massive swing towards diesel. Recent tax adjustments brought petrol models back into play, while grants drove a growth in hybrid sales and are encouraging buyers to consider EVs. In 2015 Denmark opted to wind down grants for EVs. Sales fell 80 per cent in the first half of 2016.
A national transport policy requires an understanding that while cars are a novelty for some, they are a necessity for many. Different daily needs call for diverse solutions. People buy different types of cars for a reason and the same is true for the way they are powered.
An increasingly popular option is to start the journey to electric with a plug-in hybrid electric vehicle (PHEV). The Government recognises their role as they account for 290,000 of its EV target for 2030. The recent decision to pull the plug on grants for PHEVs from January 1st seems premature and ill-timed. Doing so just before the busiest sales period for the Irish motor trade and without prior warning also seems ill-judged.
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Most people accept that grants have a limited shelf-life and the Government needs to be prudent in managing its spending. However, consumer uncertainty about taxes and incentives undermines EV policy goals and leads motorists to stand still. It would be best to restore the PHEV grants into next year and provide a clear future roadmap for taxes and incentives, offering certainty to buyers and the motor trade.