The German government is finally introducing a subsidy for electric cars. Tesla Motor's customers cannot benefit from it.
The German government is finally introducing a subsidy for electric cars. It is long over due. The German automobile lobby has been busy fighting it. Starting in May, electric car buyers receive 4,000 Euro (~$4,500) subsidy. The subsidy for plug-in hybrids is 3,000 Euro (~$3,400). This subsidy is rather modest to begin with.
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On top of that only electric cars qualify for the subsidy that do not cost more than 60,000 Euro net. This excludes the whole Tesla Motors fleet. The Model S starts at about 74,000 Euro excluding sales tax. Which other electric car is attractive on the German market besides the Tesla Model S and Model X? The ugliest BMW in the history of the Bavarian carmaker?
The German electric car subsidy is also split to be financed by the government and car makers at equal parts. Electric car buyers can only benefit from the subsidy if they buy an electric car from a participating carmaker. So far Daimler, VW and BMW signed up.
So far only 50,000 electric cars have been sold in Germany. German economic Minster Gabriel wants to increase that 10 fold until 2020 to 500,000 with the new 1 billion Euro electric car subsidy package. This will eventually take off once the Tesla Model 3 hits the market in Germany in 2018. The Model 3 will be below the 60,000 Euro limit. Of course Tesla would need to sign up to the government program.
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In neighboring Austria, electric car buyers benefit not only from subsidies, but from several tax breaks, especially for companies. Since these incentives, the Model S has become a popular company car. Austria does not have a car lobby that prevents these incentives.