Background information

The environmental bonus was introduced in July 2016 to support the spread of electric mobility in Germany and thus advance climate targets in the transport sector. The purchase of battery electric vehicles, plug-in hybrids, and fuel cell vehicles was subsidized by a grant, half of which was paid by the federal government and half by manufacturers. The legal basis for this was the directive on promoting the sale of electric vehicles issued by the Federal Ministry for Economic Affairs and Energy (BMWE) in June 2016. The subsidy was administered by the Federal Office for Economic Affairs and Export Control (BAFA). Over the years, the subsidy was adjusted several times, including with the 'innovation bonus' in 2020, and from 2023 onwards, the subsidy only applied to purely electric cars. Originally planned to run until the end of 2024, the environmental bonus was discontinued prematurely on December 17, 2023, due to the budget situation and following a ruling by the Federal Constitutional Court.

Content of measure

The environmental bonus for electric cars was aimed at private individuals, companies, foundations, corporations, and associations that purchased a new battery-electric vehicle, a fuel cell vehicle, or—until 2022—a plug-in hybrid vehicle. Only the purchase or leasing of new vehicles that were on the list of eligible models maintained by the Federal Office for Economic Affairs and Export Control (BAFA) was eligible for funding. A minimum holding period or leasing period was also required to avoid windfall effects. The subsidy consisted of a federal contribution and a mandatory manufacturer contribution. In the original scheme introduced in 2016, the government subsidy amounted to €2,000 for pure electric vehicles and €1,500 for plug-in hybrids, supplemented by the same manufacturer contribution. With the innovation bonus introduced in 2020, the federal share doubled, making up to €9,000 per vehicle possible. From 2023, the subsidy rates were gradually reduced before the subsidy was terminated prematurely on December 17, 2023. The environmental bonus was one of the central instruments for promoting electric mobility in Germany.

Use of measure

The use of the environmental bonus fluctuated considerably between 2016 and 2023, depending on the subsidy conditions. In the early years, relatively few vehicles received subsidies. However, with the introduction of the innovation premium in 2020, which doubled the federal government's share, the number of subsidies rose sharply: Between 2020 and 2022 alone, the majority of the total 2.17 million subsidized vehicles were accounted for, including 1.40 million battery electric vehicles (BEVs) and 0.77 million plug-in hybrids (PHEVs). From 2022 onwards, demand fell again as subsidies for PHEVs were restricted and finally completely abolished from 2023. At the same time, the subsidy rates for BEVs were reduced. In total, government subsidies of €10.17 billion and €5.28 billion in manufacturer contributions were approved.

Target groups

Workers	Businesses	Citizens
Does not apply to workers	Applies to all businesses	Applies to all citizens

Actors and funding

Actors	Funding
National government Company / Companies	Companies National funds

Social partners

Social partners' role in designing the measure and form of involvement:

	Trade unions	Employers' organisations
Role	No involvement	No involvement
Form	Not applicable	Not applicable

Social partners' role in the implementation, monitoring and assessment phase:

• Unknown
• Main level of involvement: N/A

Involvement

The environmental bonus was not a measure developed in cooperation with social partners, but rather a government subsidy instrument.

Views and reactions

IG Metall supported the environmental bonus in principle, as it secured demand for electric cars and investments. However, it sharply criticized the abrupt end to the bonus in December 2023, which it believed destroyed planning security and further unsettled employees and companies in the automotive industry. It called for more reliable framework conditions.

Sectors and occupations

This case is not occupation-specific.

Sources

• 29 June 2016: Bekanntmachung Richtlinie zur Förderung des Absatzes von elektrisch betriebenen Fahrzeugen (Umweltbonus) (www.bundeswirtschaftsministerium.de)
• 17 November 2022: Förderung von elektrisch betriebenen Fahrzeugen (www.bafa.de)
• 18 December 2023: Energieeffizienz Elektromobilität BAFA (www.bafa.de)
• 01 October 2024: Evaluation der „Richtlinie zur Förderung des Absatzes von elektrisch betriebenen Fahrzeugen (Umweltbonus)“ (www.bundeswirtschaftsministerium.de)
• 11 November 2024: Schriftliche Stellungnahme der IG Metall (www.bundestag.de)