EVs Get Boost Under Germany’s New Stimulus Package
The €130 billion ($146 billion) stimulus package Germany announced this week includes several provisions aimed at jumpstarting the country’s fledgling electric vehicle market.
Under the program, Germany is doubling purchase incentives to €6,000 ($6,700) for EVs priced at €40,000 ($44,800) or less.
At the same time, taxes are being hiked on some vehicles with large combustion engines.
Charging Ahead…at Every Corner
Perhaps the most interesting aspect of Germany’s plan, though, is requiring every fuel station in the country to install EV chargers.
Germany currently has about 14,100 gas stations (down considerably from a peak of 40,000 in the mid-1960s). Equipping all of them with chargers would help ease EV driving range concerns.
EVs accounted for less than 2% of new vehicle registrations last year in Germany. The rate has increased to about 3.3% in recent months, and the country has much bigger plans for the future.
Germany recently passed Norway to become Europe’s EV sales leader. The move is driven by strict emissions requirements and a steady stream of new EVs hitting the market. VW Group alone plans to spend €33 billion ($37 billion) on EVs through 2024.
An estimated 77,000—including 7,000 fast charging stations—are needed to accommodate a large-scale deployment of EVs, according to BDEW, the country’s association for the energy and water industry. As of March, Germany had just over 27,700 public charging units, according to industry statistics.
Last year, Chancellor Angela Merkel called for 1 million stations to be installed across Germany. But the rollout isn’t due to be completed until 2030.
Several consortiums also are working to build a European EV charging network. Ionity, which was formed in 2017 by Audi, BMW, Daimler, Ford, Porsche and Volkswagen (several other carmakers joined later), plans to install 400 chargers by year-end and eventually have stations at 75-mile intervals on major highways across Europe.
In addition to EVs, Germany’s wide-ranging stimulus package includes aid to families, businesses and local municipalities to help speed the country’s recovery coming out of the coronavirus lockdowns. Among the highlights are:
- Cutting the main value-added tax rate cut from 19% to 16% and the reduced rate from 7% to 5% for six months, starting July 1
- Financial aid to small businesses
- Funding new childcare facilities and providing increased tax breaks for families with children
- Investments in renewable energy storage, quantum computing and digitalization
The latest initiatives raise Germany’s COVID-19 recovery plan to €1.3 trillion ($1.5 trillion). This is by far the largest allocation in Europe as a percentage of gross domestic product.
Government officials estimate that another €25 billion may be required later.
The changing landscape requires not only new approaches to powertrains—but even new types of vehicles. Here’s how one supplier is addressing these changes.
Aptiv plc and Hertz Corp. have partnered to introduce a fleet of self-driving vehicles, beginning with 75 cars in Las Vegas this autumn.
Vehicles are being engineered with a silicon infrastructure that does everything from control the powertrain to allowing remote connections—including the possibility of hacking.