German finance minister calls for ending e-car subsidies, carmakers protest

German finance minister Christian Lindner has called for ending government subsidies for all electric cars. “We simply cannot afford misguided subsidies anymore," the head of the pro-business Free Democrats (FDP) told Welt am Sonntag, according to a Zeit report. "These cars have so far been subsidised over their lifetime with up to 20,000 euros, even for top earners. That is too much. We can save billions there, which we can use more sensibly," Lindner said, adding he would rather support citizens with a tax reform.

The Association of International Motor Vehicle Manufacturers (VDIK) said abolishing the subsidies would constitute a “severe breach of trust” given that both carmakers and their clients counted on continued support payments, reports business daily Handelsblatt. The lobby group’s president, Reinhard Zirpel, warned of a slump in the e-car market and rising CO2 transport emissions. "The discussion about an end to purchase premiums for electric vehicles alone is already causing massive uncertainty at present. The federal government should put an end to this speculation immediately." 

Germany’s government plans to end subsidies for plug-in hybrids, which have been widely criticised for not being sufficiently environmentally friendly, earlier than previously planned at the end of this year. At the same time, financial support for pure electric cars is to be gradually reduced.