France Halts Low-Earner BEV Subsidy After Flood of Applications

The French government is risking the ire of climate change lobbyists and automakers alike by halting its battery-electric-vehicle leasing subsidy for low earners after less than two months.

It acted after being flooded by tens of thousands of applications for the scheme, which offered lease payments as low as €100 ($108) a month for people earning less than €15,400 ($16,600) a year. The scheme specifically tried to address the issue that low earners cannot afford to switch from their old internal-combustion-engine vehicles to costlier BEVs.

However, its wildly successful take-up has forced the government to suspend the program for the rest of the year, likely because the €1.5 billion ($1.6 billion) to fund 20,000 BEV leases it assigned for the scheme has already been gobbled up. The government promises to resume the scheme next year aiming to cover an additional 50,000 car leases.

For most consumers on average salaries, the government currently offers car buyers a cash incentive of between €5,000 ($5,390) and €7,000 ($7,546) toward the cost of a BEV a total cost of €1 billion ($1.07 billion) annually.

Eligible vehicles for both programs have to meet limits on how much carbon was produced in their manufacturing and shipping, effectively making inexpensive Chinese-made BEVs exempt from the schemes.