German government agrees on subsidies for e-car buyers

April 27, 2016 // By Christoph Hammerschmidt
To spur the weak demand for electric and hybrid cars, the German government has agreed with the automotive industry to pay a buyer’s premium of 4000 euros for those who acquire a battery electric vehicle, 3000 euros for buyers of hybrid cars. The premium is paid for vehicles with a price tag of maximum 60.000 euros – which effectively excludes Tesla buyers.

According to press agencies, the industry and the government share the cost for the premium; each party contributes 50 %. Preliminary estimates put the cost of the program to €1.2 billion. In addition, the government will stimulate the expansion of the charging infrastructure with €300 million.


The decision – which is controversial even among the governing coalition of social democrats and conservatives and even more so in the German public – is actually an admission of failure: The government earlier published a goal of  1 million e-cars on German roads by 2020. However, three years after this announcement, only 25.500battery electric vehicles (BEVs) and 130.000 hybrids are admitted currently in Germany. Electric cars are still unpopular for their low driving range and high price. And the charging infrastructure is scarce, at best.