End of German subsidy for electric company cars to have negative effect on market - industry

The end of Germany’s buyer’s premium for electric company cars will hurt the market and place an extra burden on medium-sized businesses, the German Association of the Automotive Industry (VDA) has warned, writes business weekly WirtschaftsWoche. “The abolition of the environmental bonus for commercially used cars will have a negative effect on their registrations and thus on the electric car market as a whole,” said VDA president Hildegard Müller. From today on (1 September), only private e-cars are eligible for the premium of 3,000-4,500 euros, with the final amount depending on the price of the car. The newspaper adds that there was a last-minute run on the premium by companies in August.

Registrations of new electric vehicles had fallen in Germany following cuts in buyers’ premiums at the beginning of the year. The government in mid-2022 reduced support payments for new e-cars, arguing they had become increasingly attractive for buyers even without support payments. Last year, e-car buyers received up to 6,000 euros from the state when buying a new vehicle, in addition to up to 3,000 euros in price deductions from the car manufacturers themselves. At the start of this year, support for battery electric or fuel cell cars dropped to 3,000-4,500 euros and will be cut further from January 2024. Germany aims to have 15 million e-cars on the roads by 2030, but experts say it is unlikely the target will be met.