Popularity of electric cars drops in Germany after subsidy disappears

In January, 213,553 new passenger cars were registered in Germany. That was no less than 19.1 percent more than in the same month last year. A huge number if you compare it with the Dutch registration figures. In January, 34,477 new passenger cars were registered in the Netherlands. Almost a quarter more new EVs were registered in Germany in January than in January last year, but trade association VDA still predicts a gloomy year in terms of EV registrations.

In January, 22,474 new electric passenger cars were registered in Germany. That was a large 23.9 percent more than in January 2023. That sounds as if the EV market in Germany is growing enormously, but nothing could be further from the truth. January 2023 was a downright miserable month in terms of EV registrations by German standards. In January 2023, 18,136 EVs were registered in Germany, a good 13 percent less than in January 2022. This has everything to do with subsidies. With effect from 2023, the subsidy on new electric cars with a price of up to 40 grand in Germany will be reduced from a total of €9,000 (€6,000 from the government, €3,000 from the manufacturer) to €6,750 (€4,500 from the government, €2,250). manufacturer). The financial benefit on an EV of up to €65,000 dropped from €7,500 to €4,500. This led to a run on new EVs in the last months of 2022, resulting in relatively few new EVs in January 2023.

The registration figures for EVs in January this year therefore seem more positive than they are. Trade association VDA expects that 451,000 new electric cars will be registered in Germany this year. That sounds like a bizarre number, but it is expected to be 14 percent fewer than were registered in the whole of 2023. The expected decline in the number of new electric passenger cars registered in Germany this year is also related to subsidies.

Initially, German consumers could also benefit from thousands of euros in savings this year when purchasing an electric car. On the purchase of an EV worth up to 40 grand, you would receive a €4,500 subsidy throughout 2024 (€3,000 from the government, €1,500 from the government). No subsidies would be given for an EV of up to €65,000. In December 2023, the German government decided to put an end to the purchase subsidy. After 2022, there will no longer be a purchase subsidy available for the purchase of a plug-in hybrid in Germany. Nevertheless, VDA expects that 15 percent more plug-ins will be registered this year (185,000 units) than in 2023. Finally: what was the most popular new electric car in January? You guessed it: the Tesla Model Y. Just like in the Netherlands. With 2,393 registrations, more than 10 percent of all new EVs registered in Germany in January were Model Ys.