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Fleet industry news round-up July

31st July 2025

Industry wrap-up:

With a strong focus on stimulating the adoption of electric vehicles (EVs) and improving accessibility to charging infrastructure, July has truly underscored the fleet industry's on-going transition to zero-emission vehicles, further building on the commitments outlined in the 2025 Spending Review (Opens in new window).

This month’s Fleet Industry Round-up explores upcoming policy changes, multiple major grant releases aimed to break barriers in EV adoption, and other key factors shaping the sector.

Chancellor Rachel Reeves made the pledge in the Autumn Budget with any new rules due to take effect from April 2026, however the implementation of these rules will now be delayed until October 2026.

While employee car ownership (ECO) schemes are not as widely used as they were in the past, a number of employers still operate these schemes for their employers, for example car manufacturers and dealers.

HMRC estimate that the tax change will impact 76,000 employees at 1900 companies who currently receive cars through an ECO scheme.

The Treasury estimates that it will be worth an additional £275 million in tax take in its first year (2026/27), £220m in 2027/28, £195m in 2028/29 and £175m in 2029/30.

Publishing the draft legislation (Opens in new window), HMRC said: “Private use of a company car is a valuable benefit, and it is right the appropriate tax is paid on it.

HMRC advises that employers will need to familiarise themselves with the changes, make preparations and discussions with relevant employees and resolve the treatment of any specific cases, for example retired employees. Employers will then need to record vehicles provided through an ECO scheme as company cars through payroll or move employees from an ECO scheme to a company car scheme.

 

Earlier this month, on July 15th 2025 the government announced that it will be launching a new grant aimed to remove barriers drivers face when switching to EVs by making them more affordable. The grant will also allow access to savings of up to £1,500 a year in fuel and running costs compared to petrol cars, making them cheaper to buy and run than in previous years.

 The government has committed £650 million to the gran which will slash electric car prices, saving UK households and businesses up to £3,750 when they upgrade or switch to a new electric vehicle, however the vehicle must have an initial list price of £37,000 or less.

The grant is split into two bands:

  •   Band 1 offer the full £3,750 discount for the most sustainably produced cars from manufacturers with verified Science Based Targets and have the lowest production emissions. 
  •   Band 2 provide £1,500 for other qualifying electric vehicles that meet basic criteria but don't achieve the highest environmental standards.

Car manufacturers will be able to apply through the Electric Car grant, from the 16th July, which will accelerate access and cut costs for drivers and businesss. Additionally, drivers will start to benefit from the discount as ssoon as manufacturers successfully apply for their zero emission cars to be part of the grant scheme, as of Juky 16th 2025, with funding avaialable until the 2028 to 2029 financial year.

Check your elegibility for this grant here (Opens in new window). 

The new funding package will be delivered under what is known as the DRIVE35 programme. This programme will fund a wide spectrum of projects designed to help the UK's transition to zero-emission vehicle manufacturing – targeting high volume manufacturing, gigafactories to start ups, prototypes and new automotive innovations.
 
In the Advanced Manufacturing Sector Plan, part of the UK’S modern industrial strategy – government will commit £2 billion in funding to 2030, plus £50 million for research and development to 2035. This sets out to place British car makers in the led and build a globally competitive vejcile supply chain in the UK as part of the government’s Plan for Change.
 
DRIVE35 will build on previous success with the Automotive Transformation Fund (ATF)and Advanced propulsion centre UK (APC) R&D competitions, which totalled £6 billion in investment from the private sector, creating thousands of jobs to further boost the UK economy.
 
This also builds on the government’s commitments in this year’s spending review which outlined their investment of £2.6 billion to decarbonisation over the next three years and support the continued uptake of electric vehicles. 

 

The government has committed £63 million to help break down barriers to operating electric vehicles (EVs) and boost charging infrastructure across the UK:

  •  £25m has been marked for local authorities to install cross-pavement technology that enables cables to run safely beneath pavements and allow roadside charging from a domestic energy source, saving drivers hundreds of pounds, which will be highly supported by the fleet and leasing sectors.
  • Additionally,  £30m will help fleets develop depot charging facilities and £8m will be used to power electric ambulances and medical fleets across more than 200 NHS sites.
  • The news comes as the government promises further EV funding announcements this week, including the reported re-launch of the plug-in car grant (PiCG) (Opens in new window).
  • Alongside the boosts for electric car drivers, the government is also launching a major new  depot charging grant scheme aimed to help businesses install charging points at depots nationwide, supporting the nation’s heavy goods vehicles (HGVs), vans and coach drivers in the transition to zero emissions.

 

BVRLA has released their updated edition of the Light Commercial Vehicle (LCV) Fair Wear and Tear Guide which provides clear standards and guidance for managing vans through to time of return.

The new guide gives additional clarity on a range of areas, some of these include:

  • Keys to be present and in working order
  • EVs and HEVs to be returned with damage free cables,
  • Panel cracking or deviations from the original shape are not acceptable.

If you have leased a car with KINTO, you can see our guide on returning your vehicles at the end of agreementdownload (pdf( (Opens in new window)download (pdf(, which includes the updated BVRLA wear and tear guide.

An open letter (Opens in new window) has been delivered to the transport secretary highlighting how the government can best direct the £1.4 billion committed, as mentioned in the spending review, to support the uptake of EVs, particularly BEVs, including vans and HGVs.

Coordinated by the British Vehicle Rental and Leasing Association (BVRLA), the letter has been signed by companies across multiple sectors spanning vehicle demand, disposal, maintenance and insurance, charging providers and drivers.

They highlight how the used market offers the best value for money opportunity for the government to accelerate BEV uptake.

By underpinning vehicle affordability, equity of access and financial viability of new vehicle sales through targeted grants and subsidies, supporting the sued BEV market will increase households and SME access to a BEV.

Signatories have also called for broader interventions that include investment in skills and training, clear battery health standards and public information campaigns.

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