Thursday, 19 September 2013

The German goal of one million electric cars in 2020 going down the drain

Out of about 43 million passenger cars currently registered in Germany, not more than 7,000 are electrically driven. With 3,000 electric cars sold this year, the country is less than 0.2% of the way to achieving the government target of one million vehicle sales by 2020.

According to a study by research institute ISI, the success of electric cars is hugely dependent on energy prices:

Researchers argue that the best scenario for electric cars is for the price of batteries and energy to decrease, while diesel and petrol gets more expensive.

But if energy prices and battery costs do not fall the study believes Germany will be a long way short of its target, with consumers buying no more than 200,000 electric cars, author Martin Wietschel said.

But even the German government's department for promoting electric vehicles understands that the one million goal is impossible to reach without massive subsidies:

Henning Kagermann, head of a government department which looks at electric vehicles within the Ministry of the Environment, told the Süddeutsche newspaper that carmakers may need help from the state to realize the electric car dream, even though the German car industry is making multi-billion euro profits.

And it is not going to be cheap for the German taxpayers. Already now their contribution is huge:

By 2015, the German government will have spent about 700 million euros ($902 million) on promoting so-called e-mobility, which includes auto industry subsidies as well as support for electric transportation projects at community level. In addition, tax reductions for e-cars are planned.
Germany's neighbor France, as well as a number of other European countries mostly in Scandinavia, are trying to boost sales with direct subsidies for e-car purchases.
"This policy has failed so far to increase e-car sales," said Stefan Bratzel from the Center for Automotive Management, adding that the strategy was highly questionable in view of the states' huge public deficits.

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