Photo: Porsche
Europe's largest economy, home to automakers Volkswagen, Porsche, BWM, and Mercedes, no longer believes it is 'necessary' to offer incentives to buyers of electric vehicles.
Beginning in 2023, buyers of electric vehicles priced below 40,000 ($40,578) euros will receive an incentive of 4,500 euros ($4565) in the calendar year and 3,000 euros ($3,043) the following year, down from the current 6,000 euros ($,6086).
For vehicles priced over 40,000 euros ($40,578), the incentive will be reduced from 5,000 euros ($5,072) to 3500 euros ($3,551) next year.
The program does not pay an incentive for vehicles priced over 65,000 euros ($65,947), and that threshold will drop to 45,000 euros ($45,655) in 2024.
The government program will end once the 3.4 billion euros ($3.5 b) appropriated in the budgets over the next two years is paid out.
"E-vehicles are becoming more and more popular and will no longer need government subsidies in the foreseeable future," Economy Minister Robert Habeck said in a statement on Reuters.
Tuesday's announcement included the elimination of incentives for plug-in hybrid vehicles at the end of this year. The economic ministry has a clear vision of an all-electric vehicle future and expects the German Cabinet will approve the plan today.
Germany saw a huge leap in electric vehicle sales from 2020 to 2021, with sales almost doubling to 328,000. The country now has over one million electric vehicles on the road, with over 600,000 being all-electric.
The news comes at an interesting time in the German automotive industry.
Earlier this month, the Germany Federal Motor Vehicle Office reported new passenger car registrations declined by 18.1% from 2021; Volkswagen sales were down 24%, BMW was down 9.8%, Mercedes was down 9.5%, and Porsche was down 3.5% year over year.
Hybrid vehicles had 29.1% market share with 65,363 vehicles, and all-electric vehicles 14.4% share with 32,234 units.
In addition, the planned Porsche IPO is under scrutiny in the wake of the loss of the CEO to parent company Volkswagen and investor concerns.
For vehicles priced over 40,000 euros ($40,578), the incentive will be reduced from 5,000 euros ($5,072) to 3500 euros ($3,551) next year.
The program does not pay an incentive for vehicles priced over 65,000 euros ($65,947), and that threshold will drop to 45,000 euros ($45,655) in 2024.
The government program will end once the 3.4 billion euros ($3.5 b) appropriated in the budgets over the next two years is paid out.
"E-vehicles are becoming more and more popular and will no longer need government subsidies in the foreseeable future," Economy Minister Robert Habeck said in a statement on Reuters.
Tuesday's announcement included the elimination of incentives for plug-in hybrid vehicles at the end of this year. The economic ministry has a clear vision of an all-electric vehicle future and expects the German Cabinet will approve the plan today.
Germany saw a huge leap in electric vehicle sales from 2020 to 2021, with sales almost doubling to 328,000. The country now has over one million electric vehicles on the road, with over 600,000 being all-electric.
The news comes at an interesting time in the German automotive industry.
Earlier this month, the Germany Federal Motor Vehicle Office reported new passenger car registrations declined by 18.1% from 2021; Volkswagen sales were down 24%, BMW was down 9.8%, Mercedes was down 9.5%, and Porsche was down 3.5% year over year.
Hybrid vehicles had 29.1% market share with 65,363 vehicles, and all-electric vehicles 14.4% share with 32,234 units.
In addition, the planned Porsche IPO is under scrutiny in the wake of the loss of the CEO to parent company Volkswagen and investor concerns.
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