Surge in EV demand blows past German government’s subsidy forecasts

BERLIN — Germany’s electric vehicle subsidy scheme is running out of money far faster than the government anticipated. The program was supposed to last until 2029, but at the current rate of spending its entire €2.7 billion budget could be gone by the end of 2027, according to a document prepared for final negotiations on Germany’s 2027 federal budget and seen by WELT, a sister publication of POLITICO in the Axel Springer Group.

“The EV subsidy scheme is developing far more dynamically than anticipated when it was designed and its funding requirements were originally calculated,” the document states. The budget allocation is being adjusted, but “without changing the overall size of the program.” According to government estimates, the funding is enough to subsidize around 800,000 vehicles.

Buyers can receive government grants of up to €6,000 per vehicle. In early October, Germany’s BAFA export control agency, which administers the scheme, said it had already approved 100,000 applications and paid out more than €430 million.