Chinese EVs Not Eligible for UK Electric Car Grant: What This Means for BYD, Omoda, and Jaecoo Buyers
Source: Omoda Press
Chinese-built electric cars aren't on the government's list of eligible cars for the Electric Car Grant, which offers up to £3,750 off new EVs priced at or below £37,000. The grant scores how and where a car and its battery are made, so brands such as MG and Leapmotor offer their own discounts instead.
The UK government's Electric Car Grant has created a clear divide in the electric vehicle market, with Chinese-made EVs missing from the list of cars eligible for the £3,750 subsidy scheme. However, Chinese manufacturers aren't sitting idle, and they're responding with their own competitive discount programmes to ensure UK drivers can still access affordable electric vehicles. The Electric Car Scheme offers 200+ electric vehicles through electric car salary sacrifice, whichever brand employees choose.
What Is the Electric Car Grant?
Introduced in July 2025, the Electric Car Grant offers discounts of up to £3,750 on new electric vehicles priced at or below £37,000, with a second tier providing savings of up to £1,500. The scheme is open until 31 March 2030, or until the funding is used up, and the government says it could change without notice. Higher trims priced up to £42,000 can qualify if the cheapest version of the model is below £37,000. Drivers don't apply themselves, because the dealer applies the discount at the point of sale.
To qualify for the grants, manufacturers must hold verified Science Based Targets for emissions reduction, and vehicles are scored based on the carbon intensity of their assembly locations and battery production facilities. Assessors also consider supply chain emissions, renewable energy use, and the carbon intensity of the grid in the area where each factory is located. Targets must be validated by a third party, with a 42% emissions cut by 2030 against a 2020 baseline and net zero by 2050.
| Electric Car Grant bands compared | Band 1 | Band 2 |
|---|---|---|
| Discount | £3,750 | Up to £1,500 |
| Who it applies to | The most sustainably produced cars | Cars that meet the minimum sustainability criteria |
| Price limit | At or below £37,000 (up to £42,000 for higher trims of eligible models) | At or below £37,000 (up to £42,000 for higher trims of eligible models) |
The grant aims to reduce the cost gap between electric and petrol vehicles while incentivising sustainable manufacturing practices. Auto Express reports that more than 60 EVs are now eligible.
What Is The Eligibility Criteria?
The grants are split into two bands: Band 1 offers the full £3,750 discount for the most sustainably produced cars, while Band 2 provides up to £1,500 for vehicles meeting basic environmental criteria. The environmental scoring heavily weights battery cell manufacturing location (70%) over vehicle assembly (30%). Band 1 also requires a higher share of renewable energy in manufacturing, above 80%.
Why Don’t Chinese EVs Qualify For The Electric Car Grant?
In 2025, Transport Minister Lilian Greenwood confirmed that Chinese-assembled vehicles are not expected to qualify for the grant, because manufacturers generating electricity through coal power stations won't access the scheme. The scoring system penalises countries with carbon-intensive energy grids, including China, Korea, and Japan. When Which? checked the government's table on 7 October 2026, none of MG, BYD, Leapmotor, GWM, Omoda or Jaecoo appeared in it. The Government’s own list of eligible cars doesn't include the MG4 or Omoda either.
Eligibility is decided model by model, so popular Chinese electric cars such as the BYD Dolphin and MG4 can't be assumed to qualify, and the government's table is the reliable guide. In August 2025, a Chinese embassy spokesperson said China would "resolutely safeguard the legitimate rights and interests of Chinese companies."
Price also limits eligibility. Cars must be priced at or below £37,000, so many premium models fall outside the grant, whatever their country of manufacture.
Is MG Eligible for the Electric Car Grant?
No. The MG4 doesn't appear in the government's list of eligible cars, and MG funds its own grant on the MG4 and other models instead. The grant scores how a car and its battery are made, not the heritage of the badge. Employees can still choose MG models through salary sacrifice cars, which typically save 20 to 50% compared with a personal lease.
The Heritage Paradox
MG was established in 1924 and built its name on affordable British sports cars. It's now owned by China's SAIC Motor, and its popular electric models, including the MG4, don't appear in the government's table. That leaves one of Britain's best-known badges outside a scheme designed to support sustainable manufacturing.
What Would MG Need to Qualify?
To join the grant, SAIC would typically need to meet the same conditions as other manufacturers: validated Science Based Targets, better reporting of supply-chain carbon intensity, more renewable energy in manufacturing and transparent sustainability commitments aligned with UK climate goals. Until the government's table changes, MG buyers can use the brand's own discount or salary sacrifice instead.
Which Chinese Brands Offer Their Own Discounts?
Since the grant opened, several Chinese electric car brands have launched their own discount schemes to maintain competitiveness in the UK market. The table below shows where each brand currently stands. Used electric cars offer another route to lower monthly costs, because a lower P11D value typically means a lower monthly sacrifice.
| Brand | In the government's eligible list (7 October 2026) | Own discount |
|---|---|---|
| MG | No | Up to £1,500 on the MG4 EV, MG4 EV Urban, MGS5 EV and MGS6 EV (retail buyers, registered by 31 December 2026) |
| Leapmotor | No | £1,500 to £3,750 across the range |
| BYD | No | No grant-style discount listed |
| GWM | No | No grant-style discount listed |
| Omoda | No | No grant-style discount listed |
| Jaecoo | No | No grant-style discount listed |
BYD's Response
In August 2025, BYD said it had applied to the Electric Car Grant scheme but might not be eligible straight away. It also launched five years of free servicing on selected new and used models and extended its battery warranty to eight years or 200,000km on selected models.
MG Motor UK Discounts
MG announced its own EV Car Grant in July 2025, worth £1,500 to all private buyers of the MG4 EV and MGS5 EV with immediate effect, over and above any dealer incentives. The offer is fully funded by MG and now covers the MG4 EV, MG4 EV Urban, MGS5 EV and MGS6 EV, with savings of up to £1,500. The terms say it applies to retail and affinity customers only, excludes fleet and Motability buyers, and needs the car registered by 31 December 2026, so check whether it applies to a salary sacrifice quote.
Omoda and Jaecoo Strategies
Omoda and Jaecoo (both owned by Chinese manufacturer Chery International) declined to comment specifically on grant eligibility. Neither brand appears in the government’s eligibility table. Offers from these brands change often, so it's worth checking the current terms with the retailer before ordering.
Leapmotor and GWM Lead the Charge
Leapmotor was first to announce its own "Leap Grant" offering savings of up to £3,750, with £1,500 off the T03 (from £15,995) and £3,750 off the C10 (from £36,500).
GWM followed in 2025 with a £3,750 discount on its ORA 03 range, stating "we don't believe our customers should have to wait for the government to decide which vehicles qualify". With the discount applied, the ORA 03 PURE starts from £21,245.
Can You Still Save Money On a Chinese EV?
Yes, in two ways: through the manufacturer's own discount where one exists, and through salary sacrifice. The exclusion of Chinese EVs from government grants creates a two-tier market, but manufacturers' own discount schemes help level the playing field. For UK drivers, this means:
Immediate Benefits: Chinese brands' own grants don't depend on the government's approval process, although offers can change or end
Maintained Affordability: Discount levels match or approach government grant amounts, keeping these vehicles accessible
Market Competition: The situation encourages all manufacturers to maintain competitive pricing
How Does Salary Sacrifice Help With EV Affordability?
While grant eligibility varies, electric car salary sacrifice schemes can help employees access substantial EV savings. Through The Electric Car Scheme, employees can typically save 20-50% on both eligible and non-eligible electric vehicles compared with a personal lease
With the current 4% Benefit-in-Kind rate for 2026/27, an electric car salary sacrifice scheme typically provides consistent savings regardless of manufacturer grant eligibility. The Benefit-in-Kind rate rises to 5% in 2027/28, 7% in 2028/29 (a 2 percentage point increase) and 9% in 2029/30, against a maximum of 37% for petrol and diesel cars.
This makes premium electric vehicles significantly more affordable through pre-tax salary deductions. Savings are estimates and depend on your tax band, so the EV salary sacrifice calculator shows personal figures.
Can You Combine the Electric Car Grant With Salary Sacrifice?
For vehicles that do qualify for government grants, combining these discounts with salary sacrifice may lower the monthly cost, depending on the car and how the funder prices it. The grant is applied by the dealer at the point of sale, and funders may adjust other pricing elements, so the full discount doesn't always pass through to the monthly payment. A quote is the reliable guide, and worked examples of new electric car grants show how a discount can change the monthly payment. Even for Chinese EVs using manufacturer discounts, salary sacrifice schemes can increase savings potential.
Companies offering electric car salary sacrifice provide employees access to 200+ electric vehicles, new and used, while supporting corporate sustainability goals, regardless of grant eligibility. Employers also benefit from Complete Employer Protection, which covers redundancy, dismissal, long-term sickness, loss of licence on medical grounds and death from day one.
What This Means for the EV Market
The grant exclusion situation highlights the UK government's focus on sustainable manufacturing practices, but it also demonstrates the resilience of Chinese manufacturers in maintaining market position. The UK's approach rewards low-carbon production, which tends to favour European-built cars, and France's environmental score leaves out most China-made cars in a similar way.
However, the rapid response from Chinese manufacturers with alternative discount schemes shows their commitment to the UK market. For consumers, this competition benefits affordability across all electric vehicle segments. Employees comparing options can browse the available cars on our quote tool before choosing.
Frequently Asked Questions
Is MG Eligible for the Electric Car Grant?
No. The MG4 doesn't appear in the government's list of eligible cars. MG offers its own EV Car Grant of up to £1,500 on the MG4 EV, MG4 EV Urban, MGS5 EV and MGS6 EV for retail buyers who register by 31 December 2026.
Are Chinese Electric Cars Eligible for the Electric Car Grant?
Most aren't. None of BYD, Leapmotor, GWM, Omoda or Jaecoo appeared in the government's table when Which? checked on 7 October 2026. The grant scores production emissions, with battery manufacturing weighted at 70% and vehicle assembly at 30%, so cars built where electricity is carbon-intensive score lower.
Can You Combine the Electric Car Grant With Salary Sacrifice?
It depends on the car and how it's supplied. The grant is applied by the dealer at the point of sale, so check your quote to see whether a discount has been passed on. Employees typically save 20 to 50% through salary sacrifice compared with a personal lease, whether or not a car qualifies.
How Long Does the Electric Car Grant Last?
It runs until 31 March 2030, or until the funding is used up. The government says the scheme could change without notice, so check the official government website before ordering.
What Is the Benefit in Kind Rate for Electric Cars in 2026/27?
The rate is 4% for 2026/27. It rises to 5% in 2027/28, 7% in 2028/29 and 9% in 2029/30. The maximum rate for petrol and diesel cars is 37%. The calculation starts from the car's P11D value, as set out in the Benefit in Kind guide.
What Happens Next?
The government adds eligible cars as manufacturers are approved, and more than 60 EVs now qualify. Chinese brands could still join if they meet the sustainability criteria, but until they do, their own discounts and salary sacrifice remain the main routes to lower prices. The scheme runs until 31 March 2030, or until its funding is used up.
For UK drivers considering electric vehicles, the combination of manufacturer discounts and salary sacrifice schemes provides multiple pathways to EV affordability, ensuring the transition to cleaner transport remains accessible regardless of grant eligibility.
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Last updated: 16/10/2026
Our pricing is based on data collected from The Electric Car Scheme quote tool. All final pricing is inclusive of VAT. All prices above are based on the following lease terms; 10,000 miles pa, 36 months, and are inclusive of Maintenance and Breakdown Cover. The Electric Car Scheme’s terms and conditions apply. All deals are subject to credit approval and availability. All deals are subject to excess mileage and damage charges. Prices are calculated based on the following tax saving assumptions; England & Wales, 40% tax rate. The above prices were calculated using a flat payment profile. The Electric Car Scheme Limited provides services for the administration of your salary sacrifice employee benefits. The Electric Car Scheme Holdings Limited is a member of the BVRLA (10608), is authorised and regulated by the FCA under FRN 968270, is an Appointed Representative of Marshall Management Services Ltd under FRN 667174, and is a credit broker and not a lender or insurance provider.
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