German automakers are reluctant to finance the government’s €1 billion electric vehicle plan

Mercedes-Benz auf der Silvretta E-Auto Rallye 2015

As we previously reported, the German government is currently in the final stages of establishing a new plan to boost the electric vehicle market in the country. The plan is rumored to include tax breaks for the development of EV technologies, investments in charging infrastructures and finally a much-anticipated €5,000 discount at the purchase of an electric vehicle.

The government is reportedly in negotiations with the German auto industry to figure out the financing of the initiative, but apparently the industry is only willing to pay for about a third of what the government is asking.

Citing sources familiar with matter, German publication Handelsblatt reports that Chancellor Merkel will get involved in the negotiations this week:

Chancellor Angela Merkel will discuss a proposal along these lines with the chief executives of BMW, Mercedes-maker Daimler and Volkswagen at a meeting on Tuesday, according to the sources.

The government expects the industry to contribute €600 million to the plan:

The plan aims to make €100 million available to fund small tax breaks, €300 million for the expansion of rapid charging stations and €600 million in subsidies to encourage people to buy electric cars. Under the plan, carmakers are expected to contribute €600 million to the plan, although they have so far only offered €200 million to €250 million, according to the sources.

The latest report suggested that the €5,000 incentive should be available to EV buyers as soon as July, which adds some urgency to the current timeline of the negotiations. Last year, Germany joined the International Zero-Emission Vehicle Alliance, which aims at making all passenger vehicles emission-free by 2050.

 

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Comments

  1. focher - 7 years ago

    VW should have to pay the 600 million just by themselves.

    Tell each of them to pony up or don’t give the 5000 EUR incentive to that manufacturer’s cars.

  2. Trev Page - 7 years ago

    If they don’t participate customers will just buy the competition: Tesla.

  3. Bubba2000 - 7 years ago

    They are all cheating on emissions and mpg to some extent. The EPA mpg are not close to reality in normal day to day driving. Same with emissions. Anyway, the German industry is made of hypocrites. I could see the Chinese, Indians, etc… everybody assumes they cheat. German autos besides being misrepresented, are unreliable and expensive to maintain. They got the have the worse dealers, not that any of them are any good.

  4. Adam Ottke - 7 years ago

    If the automakers are being asked to fund the tax breaks/subsidies, then it’s not a tax break? It’s just a discount from car manufacturers? So the German government has this great plan to spur growth by injecting a few hundred million only if automakers contribute most of it? No wonder they’re not prepared to meet what Merkel is asking… She’s even asking for the credit in the form of a “tax break” instead of requesting manufacturers cut into their margins. Does this make sense to anyone???

  5. Luke - 7 years ago

    German auto manufacturers are dumber than I thought.

  6. Sww Wisdom - 7 years ago

    You don’t ask the car manufacturer to pony up, it’s tough, German (the Government) should just give a tax break (not cash rebate) of 10K Euro to all EV cars, problem solved.

    As a country it’s only single digit billion from the tax income and the pay back time for this is probably around 5 to 7 years means >10% a year return of investment

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