Germany's new purchase subsidy for electric cars is reaching the households it was designed for. Around three quarters of all applications so far come from families with a taxable annual income of no more than 60,000 euros. The figures come from the Federal Office for Economic Affairs and Export Control.
By 4 August the office held 102,539 applications, the newspaper "Handelsblatt" reports. Of those, 52,377 came from the lowest income bracket of up to 45,000 euros. A further 22,488 fell in the band between 45,001 and 60,000 euros. Just over 28,000 applications have been approved so far.
That answers a question that has followed the scheme since it began. Earlier German purchase incentives had a reputation for subsidising well-off buyers. This one is tiered by income, and the applications follow the tiers. Federal finance ministry data put roughly 42 percent of all income-tax payers below the 45,000-euro threshold and about 54 percent below 60,000 euros.
What the subsidy pays
The base grant is 3,000 euros for a pure electric car and 1,500 euros for an eligible plug-in hybrid, the technology site "heise online" reports. Households taxed on up to 60,000 euros receive another 1,000 euros, and those on up to 45,000 euros a further 1,000. Each child under 18 adds 500 euros, for a maximum of two children. At best the total reaches 6,000 euros. Private households qualify up to 80,000 euros of taxable income, a ceiling that rises by 5,000 euros per child to a maximum of 90,000.
The choice of technology is striking. Only 9,733 applications concerned plug-in hybrids or range-extender models. More than 90 percent of applicants picked a fully electric car. Purchases and leases are almost evenly split, at 51,851 against 50,688 applications.
The scheme opened on 19 May and applies retroactively to cars first registered from 1 January 2026. It carries three billion euros and is designed for around 800,000 vehicles. If every application received so far were approved, that would come to about 400 million euros. The trade publication "electrive" calculates that at this rate the money would last less than two years rather than the intended three to four.
One side effect falls on the people who cannot afford a new car. The motor-trade body DAT puts the residual value of three-year-old electric cars at the end of 2025 at 49 percent of list price, against 61 percent for diesels. DAT chief executive Jens Nietzschmann warns that the extra depreciation caused by subsidising new cars could exceed the three-billion-euro budget. Used electric cars become cheaper to buy, and riskier to sell on.