Tag Archives: Subsidies

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Germany Brings Back EV Subsidies for 2026—But Only for the Everyman

Germany’s electric car buyers are about to get another helping hand from Berlin. Starting in January 2026, the federal government will reintroduce EV subsidies through a €4 billion (£3.4bn) program—but this time, the money’s aimed squarely at the affordable end of the market.

The new scheme, hashed out between Germany’s coalition government and industry leaders last week, will offer up to €4000 (£3400) off the purchase of an electric car priced below €45,000 (£38,250). The message is clear: this isn’t about helping executives get into an electric Audi Q8 e-tron—it’s about getting regular buyers into smaller EVs like the upcoming Volkswagen ID Polo or Renault 5 E-Tech.

And unlike the last round of incentives, plug-in hybrids are out. To qualify, a vehicle must emit less than 50g/km of CO₂ on the WLTP cycle, meaning only fully electric cars make the cut.

Lessons from the Past

The move comes two years after Germany abruptly scrapped its previous subsidy program in 2023—a scheme that critics say disproportionately benefited premium brands like BMW, Mercedes-Benz, and Audi, whose pricier EVs soaked up much of the available funding. This time, officials say they’ve learned their lesson.

In addition to the tighter price ceiling, the new plan introduces income-based eligibility, limiting the grant to households earning under €45,000 a year. That’s a major shift in philosophy: Germany’s new subsidies won’t just favor cheaper cars, they’ll favor buyers who actually need the help.

Used EVs Join the Club

Perhaps the most innovative twist is that used electric cars will also qualify—a European first. Policymakers hope this will stimulate the secondhand EV market, which has lagged behind expectations due to slow depreciation and limited supply. If successful, the German approach could serve as a blueprint for other EU nations looking to make electric mobility accessible beyond new-car showrooms.

Europe Aligns Its EV Push

Germany’s new policy echoes moves in France and Italy, where governments have recently shifted subsidies toward domestically built, lower-cost EVs. Across Europe, the political tone is increasingly about protecting local manufacturing while making electrification attainable for middle-income drivers.

It’s also not lost on observers that the program arrives just months after the UK revived its Electric Car Grant, offering £1500–£3750 off sub-£37,000 EVs.

Funding and Rollout

The subsidies will draw funding from Germany’s Climate and Transformation Fund and the EU Climate Social Fund, with applications processed through the Federal Office for Economic Affairs and Export Control. The grant will be paid post-registration, ensuring only verified sales benefit.

With the average EV in Germany still hovering around €52,000, this scheme won’t instantly make electric cars affordable for everyone. But by shifting focus from luxury brands to everyday drivers, Berlin’s government is signaling a reset in Europe’s EV strategy: less prestige, more practicality.

If all goes according to plan, the electric revolution might finally reach the people it was supposed to serve in the first place.

Source: Autocar

News

The French government cut subsidies to 4,000 euros

In September 2023, in order to protect domestic vehicle manufacturers, the French government considered a new subsidy decree on subsidizing the purchase of new electric cars. Citizens with low incomes would have subsidies of up to 7,000 euros, while for others it would be 5,000 euros. However, the French government made a new decision that will cut subsidies to 4,000 euros for those with high incomes.

The original decision was changed because it was estimated that the budget of 1.5 billion euros would be insufficient. The new decision cut the subsidy for higher-income buyers by 20 percent to stay within budget and increase the number of electric vehicles on the road. Meanwhile, subsidies for the purchase of electric company cars are also being cut, as are bonuses for the purchase of new cars with internal combustion engines to replace older, more polluting vehicles.

Also, the government halted a new program to subsidize the purchase of leased electric cars for low-income people until the end of the year, after demand far exceeded initial plans. Bonuses for electric vehicles can vary from 2,250 to 9,000 euros, depending on the buyer’s income.

Source: Reuters

News

930 million euros in subsidies for EV buyers in Italy

The Italian government has announced that it intends to use subsidies to encourage the purchase of electric cars, but also to help owners of cars with the Euro 2 standard to replace them with electric ones. This program includes a financial plan of 930 million euros (13,750 euros per car), which is a record amount of subsidies in Europe. The decision is not yet official, so the current demand for EVs dropped, which forced some manufacturers like Stellantis to start laying off employees.

Stellantis announced that due to reduced demand for EVs, it was forced to lay off more than 2,000 workers at the Mirafiori plant. This is not the first time that Stellantis makes such a decision, as a similar situation occurred at the end of last year.

The union is concerned about the decision to lay off a large number of workers and has asked Stellantis management for a meeting as soon as possible. “The layoffs will apply from February 12 to March 3 and will affect 1,250 workers who make the electric Fiat 500 and another 1,000 workers who work on the production of Maserati cars,” a company spokesman said.

The current global financial situation is not good, so saving every euro is important. As a result, buyers are holding off on purchasing electric vehicles while waiting for the government to implement the announced incentives.

Source: Stellantis