SPD Pushes for New Incentives to Boost Electric Vehicle Sales

Germany's transition to electric mobility is lagging, prompting the Social Democratic Party (SPD) to propose new purchase incentives funded by the country's infrastructure special fund. In light of the ongoing struggles within the automotive industry, particularly regarding electric vehicle sales, SPD General Secretary Matthias Miersch has emphasized the need for enhanced support for electric mobility.

Miersch expressed his firm belief in the necessity of purchase incentives during a recent interview, stating that delaying action on climate protection is not an option. He highlighted that organizing the future of mobility is crucial for the nation.

Although Miersch refrained from detailing the specific nature of these proposed incentives, he pointed out that the SPD's election program previously suggested introducing a temporary tax deduction for the purchase of electric vehicles, describing it as straightforward and easily implementable.

The SPD-led coalition government had previously terminated the environmental bonus, which served as a government incentive for purchasing electric vehicles, in December 2023. This decision resulted in a significant drop in the number of new electric vehicle registrations, with only approximately 380,600 electric vehicles registered in Germany in 2024--a decline of over 27% compared to the previous year. Sales did see a recovery at the beginning of the year, with an average of 1,284 battery-electric vehicles registered daily in February, compared to 948 the previous year. However, to reach the target of having at least 15 million fully electric vehicles on the roads by the end of 2030, the country needs to achieve an average of at least 6,700 registrations per day.

Miersch proposed that new purchase incentives could be particularly beneficial for low-income households. He mentioned that besides direct purchase premiums, leasing options could also be made more accessible, considering that not everyone can afford to buy a new vehicle outright.

The idea of providing purchase incentives is not entirely new; it was previously raised by the SPD parliamentary group as part of an eight-point plan. This plan included the introduction of a social leasing program modeled after a similar initiative in France. This program aims to provide government subsidies to individuals with low to moderate incomes, allowing them to benefit from leasing options starting at EUR100 per month.

Miersch indicated that this matter would be discussed in coalition negotiations, although significant conflicts between the SPD and the opposition parties seem unlikely. The demand for government-supported purchase incentives has also been included in the coalition's preliminary agreement.

In addition to focusing on electric mobility, Miersch advocates for essential investments in educational infrastructure, acknowledging the deteriorating conditions in schools that hinder the learning environment for children.

This week, both the Bundestag and Bundesrat have initiated a financial package aimed at channeling hundreds of billions of euros into defense and infrastructure over the coming years.