Wed, Nov 06, 2019 - Page 10 News List

Germany to boost e-vehicle incentives to bolster sales

Bloomberg

Robotic arms scan the body of a Volkswagen AG ID.3 electric vehicle during quality control at the automaker’s factory in Zwickau, Germany, on Monday.

Photo: Bloomberg

German Chancellor Angela Merkel’s government and Germany’s automakers agreed to increase cash incentives for electric vehicles as they attempt to accelerate the transition away from the combustion engine and reduce harmful emissions.

A so-called “environment bonus” is to be raised by half to as much as 6,000 euros (US$6,680) per electric vehicle and the auto industry would continue to cover half the cost, Merkel’s chief spokesman Steffen Seibert said in a statement in Berlin.

The changes would take effect this month and run through 2025, said Bernhard Mattes, president of Germany’s VDA auto lobby.

“It will therefore be possible to provide support for another 650,000 to 700,000 electric vehicles,” Seibert said.

The measures were agreed at Monday evening’s meeting in Berlin between Merkel and officials from automakers, parts suppliers and labor unions, including the chief executives of Volkswagen AG (VW), BMW AG and Daimler AG.

The accord came a day after Merkel visited a revamped VW electric-vehicle plant in Zwickau, eastern Germany.

The chancellor has come under fire for failing to make more progress in curbing greenhouse-gas emissions, while VW — the world’s biggest automaker — is attempting to manage the costly shift to electric vehicles without running itself into the ground.

Merkel called the challenges facing the industry “a paradigm shift in mobility that has never been realized in automotive history.”

However, it remains unclear how many German customers will switch to electric vehicles in a country with a rich automotive heritage centered on combustion engines.

Because of higher costs for development and batteries, the price of an electric vehicle remains well above the level for a comparable combustion-powered model.

VW’s ID.3, for example, is to start at about 30,000 euros, while its new Golf with a traditional engine would start at less than 20,000 euros.

The government’s push to promote electric vehicles includes boosting the number of public charging stations to 50,000 within two years, Seibert said.

Automakers are to help fund 15,000 of the stations by 2022.

Merkel said in a podcast on Sunday that the government’s focus is on promoting electric vehicles, but that it is also open to hydrogen technology.

It wants 1 million charging stations to be in place by 2030, she said.

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