Vauxhall has reduced the prices of all its electric vehicles to under £40,000 in response to the UK government’s revised Expensive Car Supplement, which adds a £2,125 tax burden on battery electric vehicles (BEVs) priced above this threshold.
The change, which came into effect on April 1, eliminates the previous road tax exemption for BEVs. While new electric cars priced below £40,000 will now pay a first-year Vehicle Excise Duty (VED) of £10, those exceeding the threshold will face an annual £425 surcharge for five years. Vauxhall’s decision ensures its EVs remain exempt from the higher tax, keeping ownership costs lower for consumers.
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Eurig Druce, managing director of Vauxhall, criticized the policy, stating that it penalizes drivers transitioning to electric cars. “With the average price of an EV in the UK at around £48,000, this new tax means that customers buying some of the more attainable electric cars on the market are now being penalised whilst at the same time we are trying to move as many British motorists to electric as quickly as possible,” Druce said.
Other manufacturers have similarly adjusted their pricing strategies to avoid the tax hike. The recently announced Abarth 600e, for example, is priced at £36,975 for the base model and £39,875 for the premium version—deliberately set below the threshold to ensure buyers are not subjected to the additional VED charges.
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