The German government has aired plans to foster development and acceptance of electric vehicles by spending money for R&D and for consumer incentives. Berlin's goal: One million e-cars should populate Germany's cities and highways by 2020.
Is this the right strategy to save the German automotive industry in the crisis and at the same time doing something good for the environment? Will it be the bold move the industry needs to catch up with Japanese and other competitors? The answer is clearly no. Well, it might be a step into the right direction. But it is a very small one, it is too little, too late and too half-hearted.
The one million e-cars the government is aiming at is a rather modest goal, given the fact that currently about 50 million vehicles are registered in Germany. We do not expect that this number will decrease significantly by 2020, so the market share the national development plan is promising adds up to an almost ridiculously low market share of 2 percent for the e-cars. So the 'National Development Plan Electromobility', announced with much ado, is more a side-effect of the current election campaign in Berlin than a strategy with lasting substance.
Other economies have moved faster and more forcefully. France, for instance. Like in Germany, car buyers at the Seine get a bonus when they scrap their old clunker and buy a new one. Unlike in Germany however, French consumers get a higher bonus if the decide to invest into a car with an alternative drive electric or HEV.
The British government rewards buyers of electric cars with an amount of between 2300 and 5800 euros in cash. Similarly, the US administration offers rather high bonuses for e-car buyers.
In Japan, the world's most advanced market for HEVs and e-cars, the government pays 50 percent of the additional costs associated with the electric or hybrid drive. Additional scrapping incentives for old cars as well as regional and local stimulus programs for 'clean' cars add up to almost 15.000 euros for buyers of electric cars.
Some of these incentives have been in place already for quite some time. For instance, the US HEV incentive has been introduced already in 2006; in Japan the public authorities have launched their bonus system for e-cars already ten years earlier.
The German scrapping bonus program however has failed to show any steering effects with respect to fuel consumption and / or CO2 emission reduction. It was not designed for this purpose; all it was supposed to do was to stimulate the consumption of vehicles during the crisis. Now it is too late to change the concept: The program will expire by the end of this month. Perhaps it has been very efficient in that it indeed cranked up the production during in a time when the crisis threatened to seriously affect a key industry. But the government gave away any option to promote the development of innovative technologies.
Perhaps it would be a good idea for the future to coordinate such public activities on a pan-European level. Today, the multitude of measures resembles a rag rug with different, sometimes contradicting effects. After all, we should not forget that climate change and the dependency on oil are transnational issues.