Struggling with recovery: Navigating post-incentive cuts for electric vehicles in France
The world of electromobility in France is currently undergoing significant changes, as the sector grapples with consecutive months of decline in registrations and adjustments to key incentives.
In a concerning turn of events, plug-in hybrids have experienced five consecutive months of decline in registrations. This trend has been further compounded by the changes to the conversion bonus, a scheme that facilitated the transition from polluting cars to electric models. The maximum limits for the conversion bonus have been reduced, particularly for vans and business units.
One of the valued aids for sustainable mobility in France, the eco-bonus, has undergone changes as well. Previously, the eco-bonus covered up to 27% of the purchase cost of an electric car. However, for higher-income households, the eco-bonus has been reduced from 5,000 to 4,000 euros. Eligible vehicles now have to meet strict environmental and weight requirements.
The changes to the eco-bonus have impacted both individuals and businesses, leading to concerns in key sectors such as transport and logistics. Industry experts suggest the need for new models, support programs, and a second-hand market for electric cars to boost the market.
Despite these challenges, France remains one of the leading countries in promoting electromobility. In 2023, the most affordable electric car in France is the Dacia Spring, starting at 20,800 euros. Other affordable options include the Renault Twingo E-Tech, starting from 25,250 euros, the Leapmotor TO3 at 25,990 euros, and the Volkswagen e-up electric at 27,400 euros.
However, the results in August 2024 were worse than expected, with August marking the fourth consecutive month of decline in new car registrations. This has been one of the worst months in the last decade for the passenger car sector, with a total of 20,577 registrations of EVs and PHEVs in France, representing a 32.5% drop compared to the same period in 2023.
The future of electromobility in France will depend on how the government and businesses manage this transition, focusing on infrastructure, accessibility, and long-term sustainability. Experts agree that the total cost of ownership of an EV should be on par with that of a combustion car before incentives can be eliminated.
President Emmanuel Macron's decision to exclude imported cars from China from the subsidy has not helped in facilitating the transition to electric mobility. The government will need to address this issue moving forward to ensure a smooth transition.
In conclusion, the electromobility sector in France is facing challenges, but it remains a key area of focus for the government. The coming months will be crucial in determining the future direction of this sector, as stakeholders work towards a more sustainable and accessible transportation system.
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