Electric cars subsidized by German taxpayers end up on foreign roads

More than 100,000 German taxpayer-subsidized electric cars – including thousands of Teslas – have likely found their way abroad as buyers tap into a multibillion-euro incentive scheme designed to make cars battery-powered more affordable for ordinary drivers.

Of the 890,000 electric cars registered in Germany over the past 10 years, the vast majority of which were purchased with subsidies, only 756,517 remain in the country, according to a study of official data.

While a small number of the missing cars will have been decommissioned, most of them have been sold for profit to drivers in neighboring countries, according to two industry figures.

“By the time the millionth new battery-electric passenger car is registered later this year, almost a fifth of these cars will have left German roads in the past decade,” said Matthias Schmidt, an analyst based at Berlin who carried out the study. to research.

“The loser is the German taxpayer, who indirectly subsidizes clean air in cities outside Germany.”

Germany introduced the subsidy program in 2016 and has since spent at least 4.6 billion euros on subsidies for buyers of electric vehicles. Buyers are eligible for a grant of up to €6,000 per car, depending on its size, initial cost and purchase for a fleet.

But many of the subsidized vehicles may have ended up in Denmark, where taxes on the purchase of new cars made electric vehicles more expensive than in neighboring states for several years, Schmidt said.

Data from the Danish Car Importers Association By Danske Bilimportører showed that the number of electric cars registered in the country was greater than the number purchased in Denmark, suggesting that many were imported.

Schmidt also found that of the 98,000 Teslas registered in Germany in July this year, only 76,690 remained on the country’s roads, meaning one in five Teslas left the German market. The American manufacturer started producing cars near Berlin this year.

“There is a fairly simple trade-off going on,” said a leading figure in the leasing industry, adding that large corporate fleets in Germany benefit from the resale of subsidized electric models.

Germany’s opposition party Die Linke, long opposed to the subsidy program because it argued it would benefit businesses, said it was still clear the incentives were “susceptible to fraud”.

“The fact that there was not even a one-year detention period [before a car could be sold on] is more than a technical error and opens the door to fraud,” said MP Bernd Riexinger.

The German coalition government plans to reduce the subsidy program from September 2023, removing incentives for vehicle fleets.

In response to a question about abuses of the scheme, the government said it would also double the time it takes for cars to be held before they can be resold, from six months to a year.

“Anyone who wants to sell their subsidized electric car after less than a year will then have to repay the subsidy,” Germany’s economy ministry said in a statement.

“The loss in value of a used car is significantly higher after 12 months, so the business model of reselling to other European countries would become much less attractive,” he said, but stressed that the germany needed a second-hand market for electric cars and “especially for low-income buyers”.

Video: Cars, companies, countries: the race to go electric

James R. Rhodes