Chinese automaker warns that exclusionary grants may undermine Britain’s electric vehicle market long-term

China’s largest electric vehicle manufacturer, BYD, has publicly criticized the United Kingdom’s newly unveiled electric car subsidy scheme, labeling it “stupid” and warning that the policy could be detrimental to the country’s EV market over time.

The scheme, introduced in mid-July 2025, offers discounts of up to £2,500 per vehicle for buyers of electric cars produced outside China, effectively barring Chinese brands from participating. The UK government says the measure aims to protect domestic and European automakers from what it deems as unfairly subsidized Chinese competition.

In a statement issued following the announcement, BYD’s European spokesperson stated, “We find this policy both disappointing and misguided. Treating Chinese companies as pariahs undermines fair competition and ultimately limits consumer choice.”

BYD warned that the one-off discounts could operate like a “drug” for the market: while they might boost EV sales in the short term, they could foster dependency on government support, making it difficult for automakers and consumers to adjust when the incentives inevitably expire.

The UK Department for Transport defended the scheme, insisting that the temporary subsidy is designed to jumpstart domestic production and safeguard jobs. A spokesperson said, “We are committed to supporting British industry and ensuring the rapid transition to electric vehicles benefits our economy.”

However, industry analysts caution that excluding a major player such as BYD, which last year became the world’s top-selling EV brand, could backfire. “Limiting competition is rarely a recipe for sustainable growth,” noted Julia Stevens, a senior analyst at GreenTech Insights.

With the UK aiming for net-zero road emissions by 2035, ensuring a diverse and resilient EV supply chain is critical. BYD’s technology, known for its affordable price points and long-range battery performance, has been a popular choice among European consumers.

As the debate unfolds, automakers, policymakers, and environmental groups will be watching closely. The coming months will reveal whether Britain’s targeted subsidy is a strategic masterstroke or a misstep that undermines the broader goals of electrification.