France grapples with recovery: Navigating post-incentive cutbacks for electric vehicles
France, a leading country in promoting electromobility, has seen a series of developments that have impacted the electric vehicle (EV) market in recent months.
The decline in the EV market is evident, with five consecutive months of drop, particularly for plug-in hybrids. August marked one of the worst months in the last decade for the passenger car sector, with registrations dropping by 32.5% compared to the same period in 2023.
The reduction in incentives for purchasing EVs at the start of the year has generated uncertainty, and the results have been worse than expected, suggesting a potential ongoing trend of reduced demand for new vehicles.
One of the significant changes is the modification of the eco-bonus, a valued aid for sustainable mobility. Originally covering up to 27% of the purchase cost of an electric car, the eco-bonus has undergone significant cuts. The incentive remains for lower-income individuals, but it has been reduced for higher-income households from 5,000 to 4,000 euros.
Cecil Coulet, Head of European Public Affairs at Équilibre des Énergies, argues that these modifications have impacted the market decline. EVs remain a more expensive option than combustion vehicles, and their progress may slow down once higher-income customers have made the switch.
To revitalize the electric vehicle market, Clement Molizon, General Delegate of Avere-France, suggests leveraging new models. However, political instability, economic and inflationary crises have caused concern, according to Molizon.
The decision by President Emmanuel Macron to exclude imported cars from China from the subsidy has not helped in facilitating the transition to electric mobility. Maximum limits for the bonus have also been reduced, particularly for vans and business units, raising concerns in key sectors such as transport and logistics.
Despite the challenges, there are affordable electric models available. The most affordable electric car in the French region is the Dacia Spring, starting at 20,800 euros. Other affordable options include the Renault Twingo E-Tech, starting from 25,250 euros, the Leapmotor TO3 at 25,990 euros, and the Volkswagen e-up electric at 27,400 euros.
Support programs for lower-income consumers and developing a second-hand market for electric cars are necessary to prevent further deceleration, according to Coulet. Budgetary continuity and solid commitments are crucial to instil confidence and maintain an ambitious trajectory, says Molizon.
France continues to strive towards a greener future, and with the right strategies in place, the electric vehicle market may yet recover and thrive. The introduction of new subsidies starting October 1, 2025, providing households with an additional 1,000 euros for purchasing EVs equipped with batteries produced in Europe, could be a step in the right direction.
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