Tesla confirms it will now benefit from full $7,000 EV subsidy in Germany

Tesla has confirmed that following the recent price drops, both Model 3 and Model Y will now benefit from the full ~$7,000 EV subsidy in Germany for the first time.

Tesla has had its ups and downs when it comes to accessing German electric vehicle incentives.

The German auto industry had a heavy hand in managing the incentive program with the government, and Tesla claimed that it was purposefully left out at one point.

But more recently, Tesla buyers in Germany lost access to the incentive due to price caps on eligible electric vehicles, which brought Tesla’s vehicles out of range.

That was until the recent massive price cuts in Tesla’s entire lineup and across all markets, including Germany.

Today, Tesla Germany confirmed that both Model Y and Model 3, in all trims, are now eligible for the full €6,750 (~$7,000 USD) incentive in 2023 (translated from German):

As BAFA officially confirmed at the end of last week, both the Tesla Model 3 and, for the first time, the Tesla Model Y qualify for the highest premium of the new state subsidy, which will be up to €6,750 in 2023 (BAFA + manufacturer’s share). For both Model 3 and Model Y, the maximum subsidy applies to all model upgrades, including the maximum range and performance variants.

The automaker highlighted that with the price cuts and the incentives now being applied, the Model 3 and Model Y now both start at just over €40,000:

Combined with recent price adjustments, the new maximum subsidy for all variants of the Model 3 and Y allows even easier access to owning a Tesla, in line with our mission to accelerate the global shift toward sustainable mobility. The Tesla Model 3 is available from €40,470 with the maximum subsidy, and the Model Y from €41,370.

This is a new low for Tesla pricing in Germany, and it should result in a significant surge of orders for Tesla in the crucial European market. Interestingly, the difference between a Model Y SUV and Model 3 sedan is under $1000

Electrek’s Take

This is coming at a perfect time for Tesla, which needs to keep its order backlog high in Germany as it ramps up production at Gigafactory Berlin.

A strong local market where the company can quickly deliver vehicles from the factory will greatly benefit its financial position as it ramps up production.

At the last update, Tesla said that it was producing 3,000 Model Y vehicles per week at the plant, but we know that Tesla wants to bring that up to 5,000 units as soon as possible.