Electric cars: brake on the ecological bonus in 2024

The political balance between ecological transition and budgetary rigor is difficult. In 2024, it seems that the reality of public finances will not catch up with the government. A victim of its success, the ecological bonus – a system of public aid for the purchase of a new electric vehicle – has raised the bill to 1.7 billion euros in 2023. An amount well above the envelope of 1 .3 billion planned by the State according to the economic journal The echoes. In this context, the executive has chosen to cut aid.

As of January 1, 2024, for the wealthiest 40% of French people, the bonus decreases from €5,000 to €4,000 and the €1,000 granted for the purchase of a used car simply disappears. These budgetary cuts, perceived by some as putting the brakes on the electrification of the French automobile fleet, nevertheless make it possible to maintain the aid of €7,000 allocated to the lowest 50% of French people*.

A historic year for electric

Under the impetus of this aid in favor of mobility with low CO2 emissions, the automobile market reached a milestone in 2023. From now on, the French buy more electric or hybrid cars (54%), than thermal vehicles running diesel or gasoline (47%). The share of 100% electric sales even reached the historic record of 16.4% according to figures published by PFA, the group of professionals in the sector.

A French dynamic that the manufacturers of the Old Continent wish to see continue while our German neighbors have just, purely and simply, removed this aid due to a massive budgetary crisis. And for good reason, France remains one of the most generous European countries in terms of subsidies granted to electricity and in 2024, it is introducing a new deal in their allocation: the calculation of the carbon footprint of vehicles.

Favor European vehicles

From now on, the Ecological Transition Agency (ADEME) establishes an environmental score for each model put on the market by manufacturers around the world. It is therefore up to manufacturers to provide details of their supply of steel, aluminum and various materials necessary for the production of the battery, as well as the total emissions linked to the transport of the vehicle (boat, train, truck, etc.). ) from the factory to the place of sale in France. A minimum score of 60 points (out of 80) is necessary for a model to be eligible for public aid.

Concretely, vehicles from Asia which are flooding the European market – China alone represents 54% of imports of electric cars to the European Union – and whose carbon footprint is considered too high, will no longer benefit from the ecological bonus. Economic protectionism assumed by the Minister of the Economy, Bruno Le Maire, in front of the Senate last May. “The French are not intended to finance the development of Chinese factories. The implementation of stricter environmental standards will make it possible to reserve this electric bonus only for vehicles produced on European soil under the most demanding environmental conditions.“

As a result, among the six best-selling models in 2023, three will no longer be eligible for public aid and will see their prices increase. This is particularly the case for the Dacia Spring – the cheapest model on the market, 25,000 units sold last year – whose price increases from €15,800 to €20,800. But also the Chinese MG4 which now has a price of €29,990 and the Tesla Model 3 whose new purchase amounts to €42,990, compared to 37,990 in 2023.

These budgetary and environmental adjustments raise fears of a slowdown in sales of electric vehicles in France. For its part, the impact of social leasing at €100 per month looks minimal because the system is limited to 20,000 vehicles for its first year of launch. Price squeezed between the objective of accessibility to green mobility for all and the protection of the European automobile industry, the government is groping. A balancing act that demonstrates the long road ahead to democratize electric cars.

* This maximum amount concerns households whose reference tax income is at a level less than or equal to 14,089 euros per person, i.e. the 5th decile of the population according to INSEE