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18 Nov 2020, 13:38
Sören Amelang

Germany commits additional €3 bln to ease green mobility transition in car industry

Clean Energy Wire

The German government will spend an additional three billion euros to help the car industry manage a smooth transition to clean mobility and weather the coronavirus crisis. Following a summit between car industry representatives, representatives from federal states and chancellor Angela Merkel, the government said it will spend one billion euros to extend the premium for buyers of electric vehicles until the end of 2025; one billion euros to support the exchange of old trucks with models equipped with a more modern combustion engine; and one billion euros for a "future car industry fund" to support the long-term transition in the industry, which is central to the German economy. The aim of the fund is to develop a long-term structural policy orientation which, beyond the automotive industry, also takes into account the development of other related industrial sectors affected by structural change. "The transformation in the automotive sector is a central socio-political and industrial policy task that can only be mastered by joining forces," the government said.

Economy minister Peter Altmaier said the industry faced the largest challenge in its history as the coronavirus crisis added to the upheaval caused by the switch to low emission technologies, digitalisation and automation. "We have to help," Altmaier said, according to a report in the Süddeutsche Zeitung. The new agreement more than doubles previous support commitments totalling two billion euros, the article says.

The car buyers' premium of up to 9,000 euros per electric car was originally planned to end at the end of next year. Environmentalists criticised that the car buyers' premium will continue to apply to plug-in hybrids, many of which are often driven in combustion engine mode. The government should instead help suppliers "break their dependence on cars with new products," Friend of the Earth Germany's (BUND) transport expert Jens Hilgenberg told the newswire dpa. Greenpeace transport expert Tobias Austrup called for making climate-damaging cars significantly more expensive "instead of extending the expensive car buyers' premium forever."

The take-up of electric vehicles has been slow in Germany in comparison to many other markets, but thanks to new government incentives, registrations have picked up sharply in recent months. The share of pure electric cars in new car registrations reached 8.4 percent in October as a record number of car buyers opted for alternative propulsion systems.

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