Germany has increased electric vehicle incentives as part of their post-pandemic stimulus package. One measure is going to boost sales of lower-priced EVs like Tesla Model 3 and VW ID.3.

The country already had an EV incentive plan that stood out in Europe.

Germany’s EV incentive program is different than others because they negotiated it with the auto industry who contribute half of them.

When Germany first introduced its new plan to boost electric vehicle adoption through new incentives, including a €4,000 discount at the time of purchase, Tesla claimed that they were purposely left out of the program because of a cap on vehicles with a starting price of less than €60,000 negotiated by the government and the German auto industry.

The California-based automaker later adjusted its price in order to take advantage of the subsidy.

Last year, Germany updated its program again. At that point, electric cars costing less than €40,000 got €6,000 and vehicles between €40,000 and €60,000 got a €5,000 discount.

Half of the €6,000 subsidy was paid for by the government and the other half by the auto industry.

Now Germany has updated its program as part of a €130 billion euro ($146 billion) stimulus package.

They are adding €3,000 for electric cars costing less than €40,000 – resulting in a total subsidy of €6,000 from the government and total discount of €9,000 (~$10,000 USD).

There are not many electric cars starting at less than €40,000 in Germany, but a short list of them will benefit:

  • BMW i3
  • Hyundai Ioniq Electric
  • Hyundai Kona Electric,
  • Kia Nero Electric
  • Peugeot 208 Electric
  • Renault Zoe
  • Tesla’s Model 3

Another vehicle that will likely strongly benefit from the new incentive is the VW ID.3 – although it’s not yet being delivered.

The car’s starting price is expected to be around €30,000, which is going to make it extremely competitive after incentives.

Germany is also taking a dual approach to helping electric vehicle sales. They are not only discounting new EV purchases, but they are also going to increase taxes on more polluting vehicles starting next year.

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