The German government is putting the final touches on an agreement that aims to boost the demand for electric cars sales on the biggest auto market in Europe.
Although the German auto market is the largest in Europe, electric cars have been left behind, as the demand did not rise at the expected levels in recent years. The government has an optimistic target in this direction, planning to see around 1 million electric cars on German streets by 2020. It would be quite an impressive leap forward, considering the fact that just over 30,000 of such environmentally friendly vehicles have been sold in the country so far. “Germany wants to be the leader in this new age of the automobile,” Vice Chancellor Sigmar Gabriel said this week. “The government and automobile industry wish to develop a common action plan by March to do that.” Government ministers, including Chancellor Angela Merkel, met this week with Daimler AG Chief Executive Officer Dieter Zetsche, Volkswagen AG CEO Matthias Mueller and BMW AG CEO Harald Krueger to put in place a proper plan to hit the proposed target for electric cars.
However, such a program will prove quite challenging to be implemented and approved, from a financial point of view, considering the funds required for around 1 million asylum seekers. Gabriel wants to assign about 2 billion euros (2.2 billion dollars) in incentives for the electric plan, pushing for about 5,000 euros in incentives per car until 2020. “This has to be a very comprehensive effort by industry and government,” Jim Farley, Ford Motor Co.’s executive vice president for Europe, Middle East and Africa, said in an interview. “To do that we need a variety of actions, improving the infrastructure such as universal plugs to charge vehicles. In addition to that, there needs to be financial incentives, the math just doesn’t work for most customers as the cars are too expensive.”