German government has approved new incentives to boost sales of hybrid and electric cars.
Last month, the German government reached an agreement with car manufacturers to join forces and promote sales of electrified cars. The deal is now official and it means the two parties will share the costs of approximately €1 billion ($1.1B) for subsidies to anyone buying a hybrid/plug-in hybrid or a pure electric car. Around €300M ($336M) of the total sum are being allocated for building new charging stations across the country.
Go for a car that combines a combustion engine with an electric motor and you can take advantage of a sizeable incentive of €3,000 ($3,366) while EV buyers will be able to cut as much as €4,000 ($4,488) from the starting price.
Not only that, but electric vehicles are also going to be exempt from paying the related car tax for a decade (up from the previous exemption of five years). This decision has a retroactive effect since it also applies to all EVs that have already been sold starting the beginning of the year. According to Germany’s Finance Ministry, those who are going to charge their EVs while at work will have to pay a reduced tax rate of 25 percent on this non-cash benefit.
The German government hopes these significant incentives will help shift around 400,000 electrified cars to join the existing 50,000 alternatively-powered vehicles, out of a total of about 45 million cars. The ultimate goal is to have approximately one million hybrids and EVs on the roads by the end of the decade.