Minister Schneider: Electric car incentives will still be available next year

Germany is experiencing an unprecedented boom in electric vehicles, with high demand for subsidies to purchase them and plug-in hybrids. However, Environment Minister Carsten Schneider emphasizes that there are still sufficient funds to continue providing these subsidies throughout next year as well.

Image: Monta

The SPD minister told the magazine “Auto Motor und Sport”: “Those who decide to buy a battery electric vehicle now and meet the subsidy requirements need not worry about insufficient funding even looking ahead to next year,” Schneider was quoted as saying. “As soon as it becomes clear when the available subsidies are likely to be exhausted, we will inform people about it in advance.”

The budget allocated for the electric vehicle subsidy introduced in 2026 is three billion euros. Applications for this subsidy can be submitted in Germany since mid-May, and demand is high: According to the Federal Environment Ministry, the first 100,000 applications, worth over 430 million euros in total, were approved by early October — 90 percent for pure electric vehicles and the remaining 10 percent for plug-in hybrids.

The electric vehicle subsidy program was officially established on May 19, but it applies retroactively from January 1, 2026. The subsidy is aimed specifically at private households and supports the purchase or leasing of new vehicles with battery-electric drive, fuel cell drive, as well as certain plug-in hybrids and range extenders. The BAFA now also releases monthly statistics on the electric vehicle subsidy program, including key details on applicants and the models that received support. So far, reports have been published for the status as of August 1, 2026, and September 1, 2026. A third update followed at the beginning of this month for October 1, 2026.

The following information also stems from this: According to BAFA, as of October 1, funds amounting to 432 million euros were disbursed to applicants who received approval for subsidies — up from 230 million euros on September 1 and 117 million euros on August 1, 2026. At the beginning of that month, there were still nearly 2.5 billion euros available from the 3-billion-euro fund pool. Therefore, Environment Minister Schneider can be fairly confident that the budget will cover needs without problems in the coming year. Initially, when announcing the program, the government assumed that the funds would suffice for approximately 800,000 vehicles and were intended to be available nominally from 2026 to 2029, unless they run out ahead of time.

Regarding vehicle types, 91.6 percent of all approved applications so far relate to pure electric cars, with only 8.4 percent being plug-in hybrids. Applications are split almost evenly between purchase and leasing options. The typical applicant is also outlined by BAFA statistics: over half (52.3 percent) of all previously approved applications come from the lowest income bracket (annual taxable household income up to 45,000 euros). This is because the subsidies are tiered based on income and the number of minor children in the household. The next two income brackets together account for another roughly 44,000 applications. The top two brackets combined have fewer than 3,000 applications. In other words, the subsidies do reach where they are intended: among people with relatively low to moderate incomes who would otherwise not be able to afford them.

They might not purchase a new electric car after all.

Interestingly, the vast majority of applicants did not mention having minor children: Around 65,000 applications, or two-thirds of all recipients, came from “households without children eligible for subsidies,” according to BAFA. This also makes it clear that many people do not receive the full subsidy amount of 6,000 euros. This is evident from the total amount of subsidies disbursed compared to the approved applications: On average, 4,418 euros per household was allocated, a slight increase from the statistics for the previous two months of 4,380 euros and 4,350 euros respectively.

More details on the currently most popular brands and models among applicants can be found here. Chinese automakers such as Leapmotor and BYD are also highly sought after. However, according to Minister Schneider, there will be no immediate reduction in the purchase subsidy for electric cars produced in China. “No short-term changes to the incentive program are planned at the moment,” the SPD official told Auto Motor und Sport. “What we have already agreed upon in the coalition is the introduction of European value creation criteria. Once the federal government develops regulations that comply with EU law, we will integrate them into our ongoing incentive program.” This refers to the “Made-in-Europe” criteria currently under discussion at the EU level. Such a cautious approach by the current government is nothing new.

Schneider adds, “More people choosing Chinese vehicles than before is a global trend.” He is optimistic that the market share of Chinese manufacturers will remain limited. For subsidized vehicles, it currently ranges from 9 to 17 percent, depending on whether joint ventures are considered Chinese or not. This mainly refers to Leapmotor International, the joint venture between Leapmotor and Stellantis.