Potential impact on sales figures
The elimination of a substantial EV subsidy in Germany caused a significant drop in EV sales in Europe in 2023. With that in mind, it’s even more important that a new purchase subsidy for electric cars is introduced in Germany.
Various German media outlets, including our sister publication AutoBild, provide a fairly concrete preview of a new subsidy that apparently is still in the unofficial stage. Like the old one, the new subsidy provides a contribution of thousands of euros when purchasing an electric car, but it has been scaled back. The amounts are lower, and if the scheme proceeds as predicted, it will also focus more explicitly on helping low- and middle-income earners. This is reflected in a clear limit on the new price of the car to be purchased and a clear limit on the applicant’s annual income.
The suggest rumors that the subsidy applies to cars with a net recommended price of up to €45,000, but also to households with a gross income of up to €45,000. Within that income category, there are probably very few people considering a brand new EV, but fortunately there is also a subsidy for used models. By the way, subsidies for plug-in hybrids are no longer available, so it only applies to purely electric cars.
The subsidy could amount to up to €4,000 per case and is expected to start on January 1, 2026. The German government has allegedly reserved €3 billion for this until 2029 and is also looking at other solutions, such as ‘social leasing schemes’ with a government contribution intended to keep the monthly payment manageable. The goal is always the same: to enable as many people as possible to be part of the transition to electric driving.