Electric Car Grant 2026: Why No Chinese Cars Qualify

Last checked September 2026. Grant rules change, so always confirm the final price with the dealer before you sign.

The UK Electric Car Grant knocks up to £3,750 off a new electric car, and it has become one of the biggest factors in what people pay for an EV. There is one catch that matters a great deal if you are looking at a Chinese car: no Chinese-brand electric car currently qualifies. Not the MG4, not the BYD Dolphin, not the Leapmotor T03. Here is how the grant works, why Chinese cars miss out, and what the brands are doing about it.

The Electric Car Grant in 30 seconds

Band 1: £3,750 off the price, for the cars with the lowest manufacturing emissions.
Band 2: £1,500 off, for cars that pass the test with a middling score.
Price cap: the car must cost £37,000 or less (including VAT and delivery). A pricier trim up to £42,000 can qualify if it shares its battery and drivetrain with a version under £37,000.
No forms for buyers: the dealer takes the discount off at the point of sale.
Timescale: launched in July 2025 with £650 million. The Autumn Budget 2025 added £1.3 billion, and the scheme now runs to 2030 or until the money runs out.

More than 40,000 drivers had used the grant by December 2025, and the list of eligible cars keeps growing. By mid-2026 roughly 16 to 17 models sat in Band 1 and more than 50 in Band 2.

Why no Chinese car qualifies

The grant is not just about price. Every car is given a sustainability score based on where it is built and, above all, where its battery is made. The battery counts for 70% of the score and final assembly for 30%. Each country is scored on how much carbon its electricity grid produced in 2023, using International Energy Agency figures.

China still generates around 60% of its power from fossil fuels, much of it coal. A car built in China with a battery made in China scores badly on both counts, so it fails the test and gets no grant at all. Ministers have been open that the scheme is designed to reward cars made on cleaner grids.

There is a second hurdle too. The manufacturer itself must have a verified climate target, either through the Science Based Targets initiative or a high rating from the Transition Pathway Initiative. Several Chinese makers do not yet have one.

Brand	Built in	Grant status (Sept 2026)
MG	China (some models Thailand)	Not eligible
BYD	China (Hungary plant opened 2026)	Not eligible. BYD applied in August 2025 and was told it may not be immediately eligible
Leapmotor	China	Not eligible. Spanish-built cars will go to EU markets, not the UK
Omoda and Jaecoo	China	Not eligible
Changan Deepal	China	Not eligible
XPeng	China	Not eligible, and most models are over the price cap anyway
Maxus, Zeekr, Denza	China	Not eligible

It is not only Chinese brands. Cars from Western brands that are built in China, such as the smart #1 and #3, are also excluded for the same reason.

The discounts Chinese brands offer instead

Losing up to £3,750 against a rival like the Renault 5 or Kia EV3 is a big deal, so several Chinese brands have paid for their own matching discounts:

Leapmotor: up to £3,750 off the C10, £3,000 off the T03, and £1,500 off the B10 and B05.
MG: a £1,500 discount on selected electric models.
BYD: rather than a cash discount, free servicing and extended warranty offers on selected models.

These are manufacturer offers, not government money. They can end at short notice and some were due to finish in June 2026, so check what is running when you buy. Because Chinese brands already undercut many rivals on list price, the gap after the grant is often smaller than it first looks.

Does this make a Chinese EV a worse buy?

Not automatically. Compare the price you actually pay, not the list price. Take a Band 1 car at £27,000 with the full grant: it costs £23,250. A Chinese rival listed at £24,000 with a £1,500 manufacturer discount costs £22,500, and may come with more kit and a longer warranty. Work out the real figures for the exact cars you are considering.

Our 2026 guide to Chinese car brands lists current prices for every model, and our guide to charging times and costs shows what each one costs to run.

Could Chinese cars qualify in future?

Possibly, but not soon. BYD started building the Dolphin Surf and Atto 2 in Hungary in 2026, and Hungary has a much cleaner grid than China. But because the battery counts for 70% of the score, a European-assembled car with a Chinese-made battery would probably still fail. For now, no European-built Chinese-brand car sold in the UK is on the approved list.

Other ways to save on a Chinese EV

Salary sacrifice: if your employer offers it, the tax savings can be worth far more than the grant. See our salary sacrifice guide.
Company car tax: electric cars have very low benefit-in-kind rates, which applies whatever the country of manufacture.
Cheap home charging: an overnight EV tariff can cut running costs to a few pence a mile. See our EV tariffs guide.

Frequently asked questions

Is the BYD Dolphin Surf eligible for the Electric Car Grant?

No. Like every Chinese-built car, the Dolphin Surf fails the sustainability test because both the car and its battery are made in China.

Does the MG4 get the £3,750 grant?

No. MG has offered its own £1,500 discount on some electric models instead, but that is a manufacturer offer and can be withdrawn.

Do I have to apply for the grant myself?

No. The dealer applies it at the point of sale, so the discount is already in the price you are quoted for an eligible car.

How long will the Electric Car Grant last?

The government has extended it to 2030 after adding £1.3 billion in the Autumn Budget 2025, but it can close earlier if the money runs out, and the rates can change.