At the end of this year, the German government intends to lower incentive payments for purchasers of electric vehicles and remove subsidies for the purchase of plug-in hybrids.
A/P BERLIN — At the end of this year, the German government intends to lower incentive payments for purchasers of electric vehicles and remove subsidies for the purchase of plug-in hybrids.
As of 2023, the government would only pay for electric vehicles that “have a good climate-protection effect,” as it had stated shortly after taking power in December. Late on Tuesday, it released the new system’s specifics.
The government currently offers incentives to buyers of electric-only vehicles of up to 6,000 euros ($6,100), and to those who purchase plug-in hybrid vehicles for up to 4,500 euros ($4,570).
The number of electric vehicles on the road is increasing quickly, according to the economics and climate ministry, with the overall number likely to be close to 2 million this year. According to minister Robert Habeck, they “are growing in popularity and won’t require governmental subsidies for the foreseeable future.”
Government incentives for electric and fuel-cell cars will be reduced to 4,500 euros each starting in January for vehicles with a list price up to 40,000 euros and 3,000 euros ($3,045) for vehicles with a list price between 40,000 and 65,000 euros.
The incentives will only be available to private persons starting in September of next year, however, the government is thinking about keeping small enterprises and nonprofit groups eligible.
Beginning in January 2024, government incentives for cars up to 45,000 euros in price will be reduced to 3,000 euros and replaced with more expensive vehicles.
Additionally, the funding will be limited. The government incentives will stop when the last 2.5 billion euros are spent, according to Finance Minister Christian Lindner, and only tax benefits for purchasing environmentally efficient vehicles will be available after that.
Additionally, I would like to emphasize that given the billions of dollars in profits made by the auto industry, such subsidies are no longer required. Instead, I am banking on the market to provide the necessary competition to drive down the price of electric vehicles.
By 2030, the government hopes to have 15 million fully electric vehicles on the road. By increasing the use of renewable energy and pushing back Germany’s exit from coal-fired electricity from 2038, “ideally,” to 2030, it also hopes to intensify efforts against climate change.
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