The UK’s electric car grant is solid – but Germany’s is even more generous

Electric car sales are booming, and European governments are rolling out incentives to make the switch easier and more affordable. In the UK, more than 50,000 drivers have enjoyed up to £3,750 off new EVs through the Electric Car Grant since last July. Germany has now followed suit with its new E-Auto-Förderung 2026 (Electric Car Subsidy 2026).

Both programmes are designed to boost EV adoption, but they differ in how they work, who qualifies, and how generous the support is. Here’s what you need to know – and what the UK government could learn from Germany’s new scheme.

Remember, you can buy a brand new or electric car right here on Carwow. We’re here to help you through every step of your car-changing journey.

Interest in EVs is rising

Interest in EV incentives is clearly strong, and the latest Carwow data confirms this. Since the announcement of the EV subsidy in Germany – originally scheduled for 16 January but postponed to 19 January – enquiries for EVs on Carwow Germany shot up by 151% compared with the same period the week before the initially scheduled announcement. At the same time, Carwow Germany saw enquiries for petrol and diesel cars fall by 4%.

Meanwhile, when the electric car grant was announced in the UK on 15 July 2025, enquiries for EVs on the Carwow UK website went up by 53% compared with the period from 15 June to 13 July. That’s 35% more than enquiries for petrol and diesel cars combined during the same period.

So, the interest is there – but who stands to gain the most from EV incentives? Read on to find out…

How do both schemes work?

The UK government’s scheme is straightforward: qualifying new electric vehicles receive a discount that is applied immediately when you buy the car. In the 2025 Autumn Budget, the scheme received an additional £1.3bn in funding and is now set to run through 2029/30. The grant aims to reduce the upfront cost of EVs and encourage their adoption.

Here are a few things to keep in mind:

• Only brand-new EVs qualify, with a price cap of £37,000.
• The grant value is £3,750 for the greenest EVs, or £1,500 for other qualifying models.
• No income restrictions – anyone buying a qualifying EV can benefit.

The UK’s approach is simple and broad, but it has limitations: the grant is capped by the car’s price, and certain models are ineligible.

In contrast, Germany’s subsidy is more socially targeted, aiming to make EVs affordable for a wider range of households, including those buying plug-in hybrids and range extenders. Range extenders are EVs that include a small petrol or diesel engine, which doesn’t drive the wheels but acts as a generator to recharge the battery when it gets low.

You don’t receive the subsidy when you buy the car. You must first pay the full price to the dealer. Afterward, you apply for the subsidy online, and eligibility depends on your household income. If approved, the money is paid to you later. This means you need to be able to cover the full price upfront, including up to €6,000 that may be reimbursed later.

Here are some other things to know about Germany’s EV subsidy:

• New EVs and eligible plug-in hybrids can receive grants.
• You can apply for a subsidy when leasing a new EV or plug-in hybrid.
• The household income cap is €80,000 (~£69,000), with higher allowances for families with children.
• The base subsidy is €3,000 (~£2,600), with additional top-ups for income and number of children, reaching a maximum of around €6,000 (~£5,200) for low-income families.
• There’s no car price cap, making it easier to snag more premium models.

Germany’s model benefits households with lower incomes, making EV subsidies more equitable. However, it’s slightly more bureaucratic than the UK grant, as applicants must submit their requests online and have their eligibility verified.

UK vs Germany: side-by-side comparisons

Who benefits more?

Both schemes have their perks, but who benefits most depends on personal circumstances.

Under Germany’s EV subsidy, families and low-to-middle income households gain the most, with potential savings of €6,000 when combining income-based top-ups and child allowances. Unlike the UK grant, plug-in hybrids and range extenders are also eligible, giving buyers more choice.

Meanwhile, the UK EV grant benefits anyone purchasing a qualifying EV, with grants of up to £3,750. The process is simpler but limited to certain models and price ranges.

Overall, Germany’s subsidy is more generous for socially-targeted buyers who qualify, while the UK scheme prioritises simplicity and broad accessibility.

What this means for you

If you’re in Germany and meet income criteria, the E-Auto-Förderung 2026 can make higher-end EVs or family vehicles much more affordable. In the UK, the Electric Car Grant offers a straightforward way to reduce upfront costs on certain models. But if you’re looking at EVs over £37,000, you’ll see little or no benefit.

With EV prices gradually falling and governments pushing for cleaner transport, understanding these grants and subsidies can save you thousands and influence which car you choose next, regardless of the country you live in.

What the UK can learn about Germany’s new EV subsidy

While the UK’s EV grant is simple and accessible, Germany’s more socially targeted approach offers a few lessons that could make EV adoption here even more equitable and effective. Here are four things the UK government should consider:

1. Income-based support

Germany adjusts the subsidy based on household income and family size, giving greater help to those who may struggle most with EV costs. Introducing a similar tiered approach in the UK could make EVs more accessible to lower- and middle-income households.

2. Inclusion of plug-in hybrids

Germany’s scheme is open to plug-in hybrids and range extenders, not just EVs. Allowing a wider range of vehicle types in the UK could help more drivers transition gradually to fully electric.

3. Larger grants for socially-targeted buyers

The UK grant tops out at £3,750, but Germany’s programme can provide up to €6,000 (~£5,200) for eligible families. A higher subsidy for households that need it most could further accelerate EV adoption in the UK.

4. Encouraging family adoption

Germany adds extra support for households with children, making larger family electric cars more affordable. Adopting similar incentives could help UK families switch to EVs without financial strain.

In short, the UK government could maintain the simplicity of its current grant while adopting aspects of Germany’s scheme. By taking a more socially minded and equitable approach, the UK government could make EV adoption more inclusive, flexible, and impactful.

Car change? Carwow!

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