£90,000 Porsche gets low-carbon government grant

Buyers of a new luxury hybrid Porsche will have £5,000 knocked off the asking price thanks to a government subsidy.

The £89,900 Panamera S E-Hybrid, which uses an electric motor as well as a petrol engine, is eligible for the government's plug-in car grant – a subsidy scheme introduced in 2011 as a way to increase the adoption of electric cars.

Most of the cars eligible for the discount, from the Nissan Leaf at the lower end to the BMW i3 at the higher end, cost in the region of £21,000-£35,000 before the grant. But there is no cap on the price of car that can benefit from the subsidy.

Dr Neal Hockley, a lecturer in economics and policy at the University of Bangor, said: "Subsidising electric Porsches is a terrible policy. The UK government already provides considerable financial incentives for low-carbon transport through fuel duty and vehicle exercise duty. Subsidies for posh cars are unnecessary."

A Porsche spokesman said: "All we can say is government puts these structures in place to encourage manufacturers to build low-emissions cars – and that's exactly what we've done. The grant was not why we've built that car. It's one of the suite of benefits, and I think it's very fair because it's under a system of regulations that the government set up. I'm not sure there should be an exception for any sort of vehicle."

The Department for Transport, which pays the grant, also defended the payments for the Porsche. "The grant is not designed to incentivise particular models, it is to incentivise the development and roll-out of emerging low carbon technologies which we expect to become mainstream in coming decades," a spokesman said. "Making the grant available in this instance meets that goal, as it would with any other ultra-low carbon vehicle."

The plug-in hybrid car, which can go from 0 to 60mph in 5.5 seconds and reach a top speed of 167mph with the aid of the petrol engine, is also exempt from paying the London congestion charge and vehicle excise duty. It emits 71g/km of CO2, compared with the average for new cars of 133.1g/km in 2012 and 239g/km for Porsche's top-end Panamera, the Turbo S.