Subsidies for car manufacturers: 1,000 euros for charging current – Habeck wants to promote electric cars

Federal Minister of Economics Robert Habeck wants to stimulate weak demand for electric cars with charging power credits and tax incentives. “Charging has to become easier and cheaper. There also needs to be incentives for electric cars,” said the Green politician. Among other things, he proposes a charging current credit of 1,000 euros for charging at publicly accessible charging stations when buying used or new electric cars – as well as tax support for small and medium incomes.

A certain proportion of the acquisition costs should be tax deductible, as is the case with the promotion of energy-efficient building renovation, according to a paper. The ministry also considers alternatives such as a “social leasing” model to be conceivable for people with low incomes. There is one like this in France.

However, the incumbent red-green coalition’s scope for making decisions is limited. After the traffic light coalition broke up, the SPD and the Greens no longer have a majority in the Bundestag. The paper from the Ministry of Economic Affairs also makes no mention of where the money for measures such as a state-financed charging current credit should come from. At the end of September, after a “car summit” with industry representatives, Habeck said that there should be no “flash-in-the-pan measures”.

The European auto industry is under considerable pressure, the paper says. The expansion of electromobility and the increasing digitalization of cars are mentioned. At the same time, global demand is currently weak, while new competitors, particularly from China and the USA, are significantly increasing competitive pressure.

The top priority is now to create clarity and planning security on the part of politicians, according to the paper from the Ministry of Economic Affairs. In addition, measures to improve competitiveness are urgently needed.

“The automotive industry represents hundreds of thousands of jobs, locations and regions are shaped by it,” said Habeck. “A successful renewal and strengthening of the competitiveness of the automotive industry is now of central importance.”

In Germany, electric vehicles have been struggling with sales difficulties for some time. At the end of 2023, the federal government prematurely stopped funding for electric cars, citing austerity constraints.

Many car manufacturers have fallen into crisis. VW has terminated the employment security with the unions in Germany that has been in place for decades and no longer rules out plant closures and operational layoffs. There is bitter resistance to this from the works council and IG Metall. The crisis has also reached automotive suppliers.

Great demand for “social leasing” in France

In order to get more electric cars on the road instead of combustion engines, France started so-called social leasing at the beginning of the year. The conditions are strict. The offer was aimed at people with very low incomes who rely on a car for work and live at least 15 kilometers from their place of work.

The offer was used by 50,000 households, twice as many as originally thought. Because the funding pot was empty and there was a lack of supplies of electric cars, applicants were temporarily no longer eligible. Due to austerity constraints, France is reducing its support for electric cars, but wants to continue social leasing. According to government figures, the market share of electric vehicles in new car sales in France has been 17.1 percent since the beginning of the year, which is above the European average.

Habeck also has an eye on used electric cars

In addition to buying new electric cars, Habeck is also looking at the used car market: “In order to stimulate the used car market, we want to subsidize professional battery checks with 100 euros,” says his company’s paper.

It is said that used, purely electric vehicles that are exclusively equipped with an electric motor (BEV) make it easier for price-conscious customers to get started with e-mobility. A professional battery check gives the potential buyer certainty about the condition of the used vehicle battery and thus about the residual value of the vehicle. It goes on to say that the “company car privilege” in taxation should be reformed so that it provides clearer incentives for climate-friendly mobility.

Make fines flexible for the automotive industry

In the paper, the ministry also proposes, against the background of the current sales problems, to make possible fines for the auto industry for violations of fleet limits more flexible and to create the possibility of avoiding fines from 2025 by overfulfilling the requirements for 2026 and 2027.

Criticism of “mini-measure”

A charging credit of 1,000 euros will not stimulate the weak e-car market, criticized CSU General Secretary Martin Huber. “By spontaneously canceling the e-car subsidy, the Federal Minister of Economics bears personal responsibility for the collapse of the market. This mini-measure is pure window dressing.”

A credit for charging current does not make electricity cheaper overall, said a spokesman for the Association of the Automotive Industry (VDA). In addition to short-term incentives, a different energy policy is particularly necessary. “A reduction in the price of charging electricity through more competition and technology, as well as through a reduction in taxes and duties, is of central importance.” E-mobility requires long-term solutions instead of individual flashes in the pan.

Wagenknecht for “people’s leasing” to save the auto industry

The Sahra Wagenknecht alliance proposes a state-funded “people’s leasing” with installments starting at 58 euros. This should be based on the French model of “social leasing” for electric cars, but with one crucial difference: combustion engines with consumption of less than 5 liters per 100 kilometers should also be supported, demands party founder Sahra Wagenknecht. The rate would be as high as the monthly price for the Germany ticket from 2025.

“The Deutschlandticket is of no use to many people in Germany because there is simply no relevant local and long-distance public transport in their area,” said Wagenknecht to the German Press Agency. The infrastructure for electric cars is often lacking. What is needed is a state leasing program that guarantees low-fuel mobility for low and normal earners. Top earners should be left out of the program.