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Car makers ready for plug-in grant rush

Date: 25 January 2016   |   Author:

Car manufacturers have expressed confidence in their ability to meet demand for electric and plug-in hybrid models ahead of changes to the Government's Plug-in Car Grant, which will cut the amount of discount given to low-emission vehicles ordered from 1 March onwards - and those ordered before 1 March but not delivered and registered within nine months - to a maximum of £4500, and £2500 for plug-in hybrids.

Consequently, some manufacturers are predicting a pre-March spike in demand as drivers flock to order low-emission vehicles under the current system, with some vehicles - such as the £104,485 BMW i8 - no longer being eligible for a grant at all, losing out on £5000 worth of subsidy (as it exceeds the £60,000 cap for plug-in hybrid vehicles), while others, including the Mitsubishi Outlander PHEV, will see their £5000 grant halved.

As a result, Mitsubishi expects a pre-March rush as Outlander PHEV customers strive to secure the current discount. However, a spokesman for the Japanese company states that it has "plenty of stock" to meet demand and has never required more than two months from order to delivery for a PHEV - adding that it has briefed the factory to expert a short-term jump in orders.

Mercedes is fielding the possibility that some of its electric and plug-in hybrid vehicles - the B-class Electric Drive, C350e and S500 hybrid - may not be delivered before December. Citing a six-month lead time, the company says: "We are working very hard to ensure that all customers placing an order will receive their grant entitlement." However, it is also discussing whether to reimburse buyers for extra costs incurred should vehicles not be delivered in time to receive the current grant.

Audi, though, has no concerns over fulfilling A3 E-tron hybrid orders in time, stating that the petrol-electric model's 16-week lead time allows for "considerable overrun". The company's spokesperson adds: "We are in very good shape in planning and supply terms and have absolutely no reason to believe that there will be any problems with deliveries falling outside the deadline." Parent company VW is also promising no problems in delivering cars ordered in February before the end of November.

Similarly, Nissan and Renault are confident they can deliver on orders placed by the end of February, with the former saying it has "a good supply of vehicles to meet the increased demand" with around a two week turnaround from order to delivery, while deliveries for Renault's zero-emissions vehicles currently take two to three months, according to the company.

Meanwhile, delivery of BMW's electric and plug-in hybrids is likely to take around three to four months, barring the i8, which has an "extended lead time". However, BMW states: "We are confident that deliveries will be made within nine months."

Kia has an even quicker turnaround courtesy of substantial UK stock - over 50% more than in 2015, it claimed - meaning a lead time of "generally a matter of days". Should UK cars be unavailable, sourcing electric Soul EVs from Korea is likely to take around 12 weeks, Kia adds. Tesla, on the other hand, is currently quoting a delivery date of March for its Model S luxury car.

Toyota doesn't anticipate any delivery issues either, expecting orders for its Prius Plug-in to be fulfilled in less than three months. However, it does expect to see a number of buyers turn their attention from plug-in models to conventional hybrids following the reduced grant's introduction, saying: "Due to our strong hybrid line-up of [non plug-in] vehicles we see that these could be purchased instead of a plug-in if the cost is deemed too much."

Audi is also predicting "a slight reduction" in demand, although rival Mercedes sees competition as a much bigger challenge than lesser grants: "We anticipate a further year of very strong sales of the C350e with little effect from the reduction of the PiCG"