The government purchase bonus for electric cars is history. 2.4 billion euros were paid out this year. In order for e-mobility to advance, critics are demanding cheaper cars from manufacturers.
The traffic light coalition has gone through with its plan to allow the state purchase bonus for electric cars to expire earlier. Since Monday, consumers have no longer been able to submit new applications for the environmental bonus to the Federal Office of Economics and Export Control (BAFA). Funding that has already been promised is not affected. They will now be processed in the order in which they are received and then paid out.
Most applications for “e-up!” from Volkswagen
In order to strengthen demand and boost sales of electric cars, the former federal government decided on a purchase bonus in 2016. According to the Federal Ministry of Economics, around ten billion euros have since been approved for around 2.1 million vehicles. The funding program was very successful and significantly advanced electromobility in Germany, it said in a statement.
As of December 1st, BAFA had drawn up an interim report on the environmental bonus. Among other things, it calculated which models the funding was applied for. In first place is the small car “e-up!” with around 59,500 applications. from Volkswagen, which has recently stopped being sold.
This is followed by the “Model 3 2021” from Tesla (40,800 applications) and the “smart EQ fortwo (model 2017 / BR453)” with 35,700 applications. Completing the top 5 are the “Tesla Model Y 2023 Europe”, the “Tesla Model Y 2022” and the “Volkswagen ID.3 Pro Performance 150 kW (E113MJ)”.
Companies applied for funding most often
Recently, however, the number of applications has fallen. According to BAFA, around 376,000 have been received for electrically powered vehicles so far this year and 2.4 billion euros have been paid out. In 2022, 820,000 cars were subsidized – for 3.4 billion euros. ADAC spokeswoman Katrin van Randenborgh recently said there was a real run, especially at the end of 2022, to get the highest funding rate of 10,000 euros tagesschau.de.
“This year, given the changed funding background, we have seen significantly less,” reports the expert. This was due, for example, to the fact that the subsidies only applied to battery- and fuel cell-powered electric cars. Hybrid vehicles, which have accounted for around 36 percent of all applications (804,916) since the introduction of the environmental bonus, have no longer been funded since January 1, 2023.
In addition, since September 1st, only private individuals have been able to benefit from the subsidy. Companies, which still represent the largest group of applicants, received nothing. The funding also stopped for municipalities and corporations.
Funding still available in many countries
This year, manufacturers and the federal government provided funding for the purchase and leasing of purely electric cars in the amount of 2,250 to 6,750 euros – depending on the purchase price and condition of the vehicle. From next year onwards, new funding rates should apply: 1,800 to a maximum of 4,500 euros – and there should no longer be anything for electric cars with a net list price of more than 45,000 euros.
But now Germany is stopping the funding – in contrast to other countries. In France, for example, the so-called “social leasing” for electric cars has been available for a few days. From January, people who have an income of less than 15,400 euros per year and live at least 15 kilometers from work can lease a car for 100 euros or less per month. There is also still a purchase bonus with a maximum subsidy of 6,000 euros for new and 1,000 euros for used e-cars.
In the Netherlands, the purchase of a new electric car that costs no more than 45,000 euros is subsidized with up to 2,950 euros, according to the European Consumer Center. You get a maximum of 2,000 euros for used vehicles. In Italy and Spain there are still bonuses from the state. In the USA, citizens receive a tax rebate of up to $7,500. In China, electric vehicles are completely exempt from purchase tax.
“Corporations refuse affordable electric cars for the masses”
According to the current status, there is still a tax advantage in Germany. Buyers of purely electric cars do not have to pay vehicle tax for up to ten years from the time of their first registration. A new electric car is extremely expensive to purchase in this country. A model in Germany costs an average of 52,700 euros, as a recent calculation by the Center of Automotive Management (CAM) showed. According to information from the ADAC, there are currently only three models from large-scale manufacturers for a list price of less than 30,000 euros: the “Fiat 500”, the “Dacia Spring” and the “Renault Twingo”.
None of these models can be found in the top 10 applications submitted. According to experts, the fact that there are cheaper electric vehicles is a fundamental factor in ensuring that e-mobility can become suitable for the masses. The German Association for the Environment and Nature Conservation (BUND) therefore sees the automotive industry as having a duty. What they offer for electric cars is “simply not affordable for a large part of the population,” said transport expert Jens Hilgenberg to the dpa news agency. There is great potential in small cars. “However, German companies are currently refusing affordable electric cars for the masses.”
In general, the BUND welcomes the decision to “cancel the flat-rate purchase premiums for electric cars financed with tax money.” Especially since the biggest driver for more electric cars on the road is not the subsidies, but rather the EU fleet regulation and thus the legal requirements for manufacturers. The Federal Association of Consumer Organizations sees it similarly. “Purchase bonuses were important in the short term to stimulate the spread of electric cars,” said mobility expert Marion Jungbluth. In the long term, however, the market ramp-up cannot be financed at taxpayer expense.
Industry speaks of “deep loss of trust”
The automotive industry itself has sharply criticized the sudden end to the environmental bonus – particularly because of the lack of a transition period. The industry association VDA called on politicians to find a solution that would guarantee customers the bonus they had planned for when they bought their car. Denying people support because they want to continue to stick to the registration date instead of the purchase date of an electric car “undermines consumers’ trust in the reliability of politics,” said VDA President Hildegard Müller.
Volkswagen explained that the exit date of December 17th had created clarity regarding the expiry of the environmental bonus. However, all orders that could not be approved until last weekend were not taken into account. “This leads to a deep loss of trust,” said a spokesman. “Customers ordered electric vehicles in the belief that they would receive government funding and are now left empty-handed.”
The ADAC also criticized the procedure for only making the funding commitment upon registration rather than upon purchase. The decision is particularly bitter for consumers who had ordered an electric vehicle but were unable to register it before December 17th because they had taken the environmental bonus into account. Opel’s parent company, Stellantis, is now accommodating its private customers: it guarantees them the full environmental bonus; if you register the vehicle you have already ordered by December 31st.
Oliver Neuroth, ARD Berlin, tagesschau, December 18, 2023 5:13 p.m