The Fiat 500e has now become one of the most affordable cars on sale in the UK, thanks to its qualification for the highest tier of the government’s Electric Car Grant (ECG).

The ECG offers either £1500 or £3750 off the price of a new electric vehicle, depending on several criteria such as the emissions generated during battery and vehicle production, along with specific warranty conditions.

With the new £3750 grant applied, the starting price of the Fiat 500e has dropped to £17,245. This means it is now £1750 cheaper than the upcoming Fiat 500 Hybrid.

Currently, the only cars that undercut the Fiat 500e in price are the Kia Picanto (£17,095), Dacia Sandero (£14,765), Leapmotor T03 (£12,995), and Dacia Spring (£11,995).

This substantial price reduction comes as good news for Fiat, as the company has been struggling to attract buyers for the 500e. According to industry data, fewer than 1000 units were registered in the UK last year. Fiat’s overall sales in the first half of 2026 also dropped by 39% compared to the same period in the previous year, falling to 3748 units.

Boosting the 500e’s sales performance is key for Fiat as it works to meet the UK’s Zero Emission Vehicle (ZEV) mandate, which compels manufacturers to increase the proportion of electric vehicles they sell each year.

Under the current ZEV rules, at least one in every three cars sold by a manufacturer this year must be fully electric. Alternatively, companies can sell enough low-emission internal combustion engine (ICE) cars to generate emissions credits, which can be traded to offset EV requirements.

Manufacturers that fail to meet their targets face fines of £12,000 for each ICE vehicle sold beyond their permitted quota.

Most of Fiat’s UK sales this year have been mild hybrid models. Strengthening 500e sales will give Fiat the flexibility to continue selling its popular mild-hybrid vehicles, such as the Fiat 600 crossover. It will also help pave the way for new models, including the petrol-powered, manual-transmission Fiat Grande Panda.

The Fiat 500e is scheduled for an update next year to make it more competitive against the latest generation of compact European EVs, including the upcoming Renault Twingo. The revised model is expected to feature a higher-capacity battery pack with increased energy density, extending its range beyond the current figures of 118 miles for the Urban Range and 199 miles for the Standard Range.

Following the 500e’s eligibility for the ECG, the Standard Range version now starts at £20,245.

The Abarth 500e hot hatchback, which is produced alongside the Fiat 500e at the Pomigliano facility in Italy, also qualifies for the £3750 grant. As a result, its price has been reduced to £24,245.