Germany’s flagship measure to boost car sales

The coronavirus is dramatically affecting the car sector and, in a country like Germany, where there are so many key European manufacturers and so many component and accessory companies related to the automobile sector, the consequences are being especially noticeable. sensitive. This has led the German Government to launch a € 130 billion stimulus package to help revive the sector and Another of the measures adopted by Germany consists of lowering VAT on the purchase of cars., but the controversy has arisen when verifying that diesel and gasoline cars are left out of these grants.

In Germany the weight of the automotive sector is very important. With a turnover of more than 435 billion euros and around 830,000 employees (in 2019), it is one of the most important industries in the country. This is why, according to information published by our German colleagues, federal ministers Andreas Scheuer (CSU, transport) and Peter Altmaier (CDU, economics) had requested a large amount of funds due to the coronavirus crisis, which also included models of modern gasoline and diesel. But finally it was not so.

By cons, aid for the purchase of electric cars has increased. Specific, Angela Merkel’s government is going to double the incentives to buy electricity, which will become 6,000 euros, instead of the 3,000 previously granted.

The increase in the ‘innovation premium’, which is what Germany calls aid for the purchase of zero emission vehicles, with a limit on the purchase price of up to 40,000 euros, includes an additional discount granted by each respective manufacturer (currently around 3,000 euros).

And according to the information from AUTO BILD, electric cars between 40,000 to 65,000 euros will have 5,000 euros in the purchase bonus in the future, more than 2,500 from the manufacturer. For their part, plug-in hybrid models of up to 40,000 euros benefit from 4,500 euros from the government and 2,250 euros from the brand; plug-in hybrids from 40,000 to 65,000 euros, with 3,750 euros from the government and 1,875 euros from the manufacturer.

In total, the financial volume of these measures is around 2,200 million euros. And customers are They will be able to start benefiting from these measures as of July 1, 2020 and until the end of 2021.

VAT reduction, but not on combustion cars

In addition, from July 1 to December 31, 2020, VAT will be reduced from 19 to 16%. But the great controversy is, as we have already anticipated, that combustion cars are left out of this aid plan. The explanations given by the representatives of the German government are that they want to benefit from the reduction of carbon dioxide emissions. For this reason, a bonus program will be launched for future investments of car manufacturers in the amount of a billion euros for the years 2020 and 2021. And billions more will be used to expand the infrastructure of the charging station to electric cars and battery production. The sale of greener trucks and the switch to modern aircraft will also be promoted.

Likewise, the current tax exemption for pure electrics will be expanded; Thus, this program will end on December 31, 2030, instead of that same day in 2025.

We couldn’t launch a traditional stimulus package“Angela Merkel declared during the presentation of this plan. In this way, Germany distances itself from the path marked by Francia, that last week announced its plan to boost the automotive industry, which does take into account the latest generation combustion vehicles. Although the aid is less (3,000 euros), than if you buy a 100% electric or plug-in hybrid car (between 2,000 and 7,000 euros).

And what happens in Spain? Pedro Sánchez has already advanced that the Government is preparing a plan that is pending approval “as soon as possible“According to which one of the main objectives will be the renovation of the park. But for the moment nothing else has been specified.

This article was published in Autobild by Enrique Trillo.

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