German Government announces incentives for electric mobility
“The steps announced by the German Government will pave the way for encouraging electric mobility in Germany. In recent years the German automotive companies have invested more than 14 billion euros in electric mobility, and with around 30 e-models on the market they are among the leading providers worldwide. However, Germany still has some way to catch up when it comes to developing into the leading market. The measures for establishing a nationwide charging infrastructure and assisting the market ramp-up should therefore be implemented swiftly,” said Matthias Wissmann, President of the German Association of the Automotive Industry (VDA). “Customers who have so far not decided to buy an electric car because the situation was uncertain can now make plans. That will help the market to grow.”
The German Government is drawing up a one billion euro program to promote electric mobility up to 2020. The sum of 300 million euros will be provided for state investment in the charging infrastructure. Another 100 million euros will feed into the public procurement initiative. In addition, there are plans for relief under tax law, such as tax-free charging on company premises.
Until now the German market for e-vehicles has been small. In 2015 electric vehicles accounted for a tiny 0.7 percent of new registrations. “To get more electric cars on the roads, the network of charging pillars will have to be greatly expanded. At this time Germany has only around 5,800 public charging points and 150 rapid charging points,” Wissmann said. “So it is right that the Government should now move this area forward.”
A direct purchasing incentive will also be introduced, for which the state will stump up 600 million euros. The plan is to provide an environmental subsidy of 4,000 euros for the purchase of a purely electric vehicle, and 3,000 euros for a plug-in hybrid, for business and private customers alike. The subsidy will also apply to leasing vehicles. The automotive manufacturers will contribute to the scheme, providing half of the bonus payment for every e-vehicle (battery vehicle, plug-in or range-extender) sold.
Wissmann commented: “Electric mobility in Germany needs an initial boost to become established. Politicians and companies are creating the basic conditions for electric mobility to gain a foothold on the home market. After a few years, the ‘jump leads’ can be put away again.” He added that the international markets demonstrate a clear link between market development and state promotion. “Electric mobility takes off faster in countries where the state provides an impulse for development. In Norway and the Netherlands, for example, the German manufacturers have a 40 to 50 percent share of the electric vehicle market,” the VDA president stated. “This shows that we are offering what the customers want.”
Wissmann added that it was right and important that a purchasing incentive should apply not only to pure battery vehicles, as agreed in the National Platform for Electric Mobility (NPE). “This is because plug-in hybrids and range extenders also offer a significant environmental benefit,” Wissmann explained. “The Electric Mobility Act stipulates that eligible vehicles have a maximum CO2 output of 50 g per kilometer. Plug-in hybrids and range extenders are thus important drivers of development and technological pioneers on the path to electrification of road traffic.”
Wissmann stressed electric mobility’s key role in future climate-friendly mobility. “This is a strategic policy decision to move ‘away from oil’. The CO2 targets agreed in Paris can only be achieved with a considerable proportion of electric vehicles. The German automotive industry will therefore continue to drive forward its global electric mobility offensive. The next generation of batteries will be available at around 2025. Then the range will increase and the prices will be roughly 50 percent lower than those of today’s battery-powered models.”