Taxi manufacturer LEVC urges government to rethink importance of funding as electric cab grant faces axe
The Plug-in Taxi Grant (PiTG), a crucial support mechanism for drivers purchasing zero-emission capable black cabs, is set to end on 5 April 2025. With the grant currently offering a £6,000 discount on new vehicles, concerns are mounting over the financial barriers that could slow the shift to cleaner taxis.
LEVC Managing Director, Chris Allen, highlighted the importance of maintaining incentives to sustain the transition to a greener fleet. Since 2018, over 60% of London’s black cabs have adopted LEVC’s zero-exhaust-emission TX model, contributing to significant emissions reductions. However, without continued government support, industry leaders fear a slowdown in progress.
The PiTG has played a key role in enabling drivers to invest in electric cabs. Yet, its reduction from £7,500 to £6,000 in early 2024 signalled a diminishing level of support. Calls are growing for an extension, with some suggesting the grant should be restored to its former level to drive demand.
Allen highlighted other financial incentives have proven effective too. Scotland’s ‘Switched on Taxi’ loan scheme, offering interest-free loans of up to £75,000, has helped modernise the sector. Industry figures are now urging similar measures in England, including VAT exemptions for wheelchair-accessible black cabs.
The end of the PiTG could further shrink London’s taxi fleet, which has already dropped from 19,000 to 14,500 vehicles since pre-pandemic levels. With up to 1,000 older diesel taxis reaching the end of their operational life this year, the risk of decline continues unless strong policy action is taken.
LEVC estimates that for London’s growing population and international visitor numbers, the taxi fleet should expand to at least 18,000 vehicles. The accessibility of black cabs also remains a national issue, with around 230,000 wheelchair users in London and 1.37 million across the UK relying on these vehicles for essential journeys.
With Transport for London set to release its updated Taxi and Private Hire Action Plan in the coming weeks, attention is now on policymakers to ensure that investment in zero-emission cabs does not stall. As demand for black cabs remains high, particularly at key hubs like Heathrow Airport, industry leaders warn that leaving the transition to market forces alone could jeopardise both environmental progress and the future of the trade.
Chris Allen, LEVC Managing Director, said in full: “As the Plug-in Taxi Grant (PiTG) approaches its likely end on April 5th, 2025, this is an important moment to reflect on the strides made in transitioning the London taxi sector to a more sustainable, green technology. Over 60% of the taxi fleet in London is now made up of the zero-exhaust-emission capable TX taxi, manufactured in the Midlands by LEVC since 2018.
“LEVC, along with its partners and representatives from the taxi trade, must consider how we continue to foster growth and adoption of urban e-mobility, as we face the reality of falling levels of Government support.
“Since its launch seven years ago, the TX has achieved many impressive milestones. With over 11,000 units sold worldwide, the fleet has collectively driven more than 1 billion miles—equivalent to circling the Earth over 40,000 times. In turn, this has reduced the amount of CO2 from entering the atmosphere through driven exhaust emissions by around 300,000,000 kgs, demonstrating the real-world impact of LEVC’s zero-exhaust-emission capable ‘eCity’ technology.
“The PiTG has been a crucial driver behind these numbers, as the UK and especially London, remains the biggest market for TX. While the success of the PiTG cannot be overstated, its potential upcoming conclusion raises concerns and LEVC continues to call on Government to review its position on the grant to ensure the momentum of the transition isn’t lost. In Q1 2024, the grant fell from £7,500 to £6,000 – where it remains today. As a minimum, this grant should be extended and ideally increased to its former level, which would actively help drive new demand and revitalise the current shortfall in adoption.
“Without the provision of the current PiTG grant, the cost of purchasing a new black cab becomes a bigger barrier to entry, meaning existing drivers may find it harder to invest in zero-exhaust-emission capable taxis and efforts to grow the trade become far more challenging.
“Unavoidably, this will impact the overall progress we’re making towards creating cleaner cities in the UK, powered by sustainable, accessible modes of transport.
“In forecasting what is needed to provide the foundations for a healthy, growing taxi trade in London, it's important that we recognise driver numbers and taxis on the road have declined heavily from pre-covid levels, which hovered around 19,000 vehicles. Today that number has fallen to around 14,500, and this year alone, 800 - 1,000 older diesel taxis will reach the end of their licensed operating life. Of the entire current London taxi fleet, over 5,600 black cabs are still diesel powered and all must be supported in making the swich to a more modern, cleaner alternative.
“Drivers must have clearly set incentives if they are to be convinced to make the investment in a new, zero-exhaust-emission capable taxi and remain active in the trade. We hope that the forthcoming Taxi and Private Hire Action Plan refresh, due to be published by TfL in the coming weeks, will set the direction and policy intention needed to ensure the valuable momentum London has built is not lost. Around 40% of the taxi parc in London is still made up of polluting, diesel vehicles so there is still a long way to go.
“LEVC estimates that to support the 9,000,000 strong population of London and the 20,000,000 international visitors each year, the taxi trade needs to grow to a minimum of 18,000 vehicles and 20,000 drivers, returning to near pre-covid levels. This means at least one black cab per 500 residents or one per 1,100 international visitors. By contrast, there is an estimated one black cab per 450 people in Edinburgh, which serves a much smaller population of around 500,000 and 4,000,000 visitors.
“Achieving this number is paramount in supporting the critical demand and reliance placed on black cabs, which enable multi-modal public transport. Across the UK, black cabs service the mobility needs of critical infrastructure like hospitals, airports, schools and care homes while also supporting the night time economy with safe and reliable transport. We also know that in the last two years, London’s largest taxi rank at Heathrow Airport has seen some of the highest recorded movements since records began in 2010, showcasing the growing demand for black cabs in the capital.
“Out of the total London population, around 230,000 people are estimated to be wheelchair users or people with mobility needs who rely on the accessibility features of black cabs for vital journeys. There are also around 1.37m wheelchair users across the UK, who rely on the iconic black cab as a vital transport service in cities outside of the capital. Therefore, it is of national interest to ensure that the black cab trade is preserved, enabling accessible e-mobility across the country.
“It's also important to recognise the work being done by cities like Manchester to deliver an incentive-led Clean Air Plan, which relies heavily on the continuation of the PiTG. To support the growth of sustainable policy setting and the adoption of zero-exhaust-emission capable, wheelchair accessible taxis across the UK, ambitious incentivisation must continue.
“LEVC has played a leading role in this industry for over 100 years, with the black cab now firmly cemented as one of the world’s most recognisable and iconic vehicles. Since 1908, LEVC has focused on creating vehicles that meet the evolving needs of operators and passengers, and more recently, we’ve transformed our business to become a leader in zero-carbon mobility technology. The TX has been a cornerstone in this effort, but we know the road ahead requires continued collaboration and support. Beyond vehicle innovation, we’re committed to working with the government, local authorities, and other stakeholders operating within the taxi trade to ensure the adoption of urban e-mobility continues at pace. We’re seeing encouraging early signs that ambitious local planning and targeted incentives are stimulating markets outside of London, but access to clean, accessible taxis as a vital cog in the transport ecosystem cannot be left to chance.
“While the transition to zero-exhaust-emission taxis is far from complete, the success we’ve seen so far — both in emissions reduction and in making electric taxis a viable choice for operators — has been supported by the PiTG. As this support comes to an end, it’s critical that we reflect on the progress and pace of change in the taxi trade and what is at stake if we do not continue to support drivers, and passengers, in these critical transitionary years.
“Together, we can ensure a sustainable future for the taxi industry and a cleaner environment for generations to come.”
