Stalled electric car industry support could cost North East jobs

More than 25,000 North East jobs will be put at risk if the Government does not improve support for the electric car industry, ministers have been told

More than 25,000 North East jobs will be put at risk if the Government does not improve support for the electric car industry, ministers have been told.

Continued failure to make charging points more accessible and a cut in the financial incentives offered to firms could undermine the take-up of electric cars such as the Nissan Leaf, MPs have warned.

Gateshead’s Ian Mearns was among those pushing for tax incentives as the Government debated changes to its support for cars with low carbon dioxide emissions.

Mr Mearns said he was concerned by a decision to reduce support for companies buying electric cars. It adds, he said, to an ongoing worry that ministers had messed up support for charging points.

He told MPs: “Initial public investment in charging infrastructure was designed to provide reassurance to potential plug-in vehicle owners that they would be able to charge their cars in public spaces if necessary.

“The DFT hopes that this will stimulate demand for plug-in vehicles. However, the national charge-point registry was far from comprehensive and lacked even the location of the majority of charge points installed using public funds. That is of concern.

“We are also concerned about the cost to the public or to companies buying fleets of electric vehicles, which represents a significant initial capital outlay.

“Undoubtedly there are savings down the line from fuel use, but we are concerned that getting rid of the first-year allowance for fleet vehicles will have a significant impact on the uptake of electric vehicles in the overall market.

“The industry is of particular significance to the North East because of the role of Nissan and its supply chain.

“Nissan on its own employs about 6,500 people, but there are probably about another 25,000 jobs in the supply chain in the wider North East region and the North of England.”

He was backed by Newcastle North MP Catherine McKinnell, who said that “as with so many other areas of Government policy, the continued chopping and changing and giving out mixed messages across Whitehall has caused unnecessary uncertainty for a relatively new industry”.

She added: “The decision to exclude UK firms that are leasing or renting low-emission cars from the 100% first-year allowance is worrying. It is another bad signal that the Government are sending out.”

Conservative Economic Secretary Sajid Javid said the changes to allowances were needed “to protect the Exchequer from abuse”.

“Without the exclusion,” he said, “there is nothing to stop an overseas business leasing low-emission vehicles from the UK in order to benefit from the first-year allowance.

“In that situation, the Exchequer would subsidise the cost of providing the first-year allowance, despite no environmental or economic benefit accruing to the United Kingdom.”

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