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Transportation Businesses

German Government Expands Subsidies For Electric Cars (dw.com) 86

The German government and car industry have agreed to increase joint subsidies for the purchase of electric cars on the same day automobile giant Volkswagen began production of a new all-electric vehicle. From a report: The agreement between the government and the automobile industry was reached following a Monday evening "car summit" aimed at fostering the mass production of cleaner transportation. Under the agreement, consumer subsidies for electric cars costing less than $44,500 will increase to about $6,700 from from $4,400. Purchasers of plug-in hybrids in this price range would be given a subsidy of $5,000, up from $3,320. For electric cars over $44,500, there will be an increase in the subsidy by 25%. Industry and government will evenly split the cost of the subsidies. The subsidies will also be extended from the end of 2020 to the end of 2025. In addition to the subsidy issue, the two sides discussed ways to expand infrastructure for electric cars.
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German Government Expands Subsidies For Electric Cars

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  • by AmiMoJo ( 196126 ) on Tuesday November 05, 2019 @11:13AM (#59383482) Homepage Journal

    How does splitting the subsidy work? I guess there must be some benefit to the manufacturer doing it this way rather than just dropping the list price by a few thousand Euro.

    • You can rest assured that the subsidy is affecting taxes, essentially meaning that the government will foot the whole bill. It's not like Merkel ever did anything to hurt the sacred German industry.

    • by LynnwoodRooster ( 966895 ) on Tuesday November 05, 2019 @11:45AM (#59383626) Journal
      My understanding is that it allows a "double dip" - it reduces your gross profit, AND you get to take a tax credit against net profits. So if your company made $1,000,000 in revenue, and you made $500,000 in gross profit, a $10,000 subsidy would mean your gross profit was $490,000. If the tax rate was 20%, you would normally pay $98,000 in taxes on that profit. But thanks to the subsidy, you also get to count it against tax payments, so that means you only pay $88,000 in taxes. So effectively it's a tax cut - twice - for the industry.
      • But thanks to the subsidy, you also get to count it against tax payments, so that means you only pay $88,000 in taxes.
        That does not make any sense at all.

        • I believe it's a double-dip credit - you get to take it off of gross receipts AND count it against tax payments.
          • And why would that be the case?
            The article says, the cost is split, why would the company get two tax credits?
            It does not nake any sense, sorry, And your math made no sense either, why would anyone get a tax reduction two times for the same thing?

        • by AHuxley ( 892839 )
          re "That does not make any sense at all."
          Its a green Germany idea.. "sense" left that side of politics back in the 1980's...
          The government lets people buying electric transport feel better by giving more gov money away...
    • by Freischutz ( 4776131 ) on Tuesday November 05, 2019 @11:47AM (#59383634)

      How does splitting the subsidy work? I guess there must be some benefit to the manufacturer doing it this way rather than just dropping the list price by a few thousand Euro.

      The VW diesel scandal was something of a wake up call to the German government. They finally realized that 'green diesel' was a steaming pile of bullshit and that the German car giants who are already playing a game of catch-up with Tesla would be playing catch-up with the entire industry if nothing was done. So, now the the German car giants are being dragged, kicking and screaming in protest, into the EV market at least a bit ahead of the S-curve before the traditional combustion engine goes the way of the dinosaurs. How are they benefiting from this? For one thing German car companies are getting the transition to electric vehicles and the re-tooling of their factories subsidized by the taxpayer while more libertarian countries are still waiting for market forces to kick their manufacturers in the ass and the faction of the US ruling class that is currently in charge is busy trying to put as many rocks and lions in Tesla's way as possible because: 'the future is coal and gasoline, not hippie tree-hugger libtard electric cars'. Another indirect benefit to the German car industry is that a bunch of dusty old conservative 'gas-n-diesel' CEOs and chief engineers have been golden parachuted into retirement thanks to the diesel emissions scandal and replaced by people with new ideas.

      • The VW diesel scandal was something of a wake up call to the German government. They finally realized that 'green diesel' was a steaming pile of bullshit

        "Green Diesel", the popular name for diesel made by refining oil [wikipedia.org] (whether animal or vegetable) is a 1:1 replacement for diesel fuel, unlike biodiesel. Maybe you meant "Clean Diesel"?

        But even clean[er] diesels aren't a scam, only the ones made in Germany by a combination of corrupt automakers, and a corrupt supplier (Bosch). Mazda has a nice one. They held off building one until they could do it right, unlike the Germans.

        • The VW diesel scandal was something of a wake up call to the German government. They finally realized that 'green diesel' was a steaming pile of bullshit

          "Green Diesel", the popular name for diesel made by refining oil [wikipedia.org] (whether animal or vegetable) is a 1:1 replacement for diesel fuel, unlike biodiesel. Maybe you meant "Clean Diesel"?

          But even clean[er] diesels aren't a scam, only the ones made in Germany by a combination of corrupt automakers, and a corrupt supplier (Bosch). Mazda has a nice one. They held off building one until they could do it right, unlike the Germans.

          Yeah, I meant clean diesel. That having been said green (as in bio) diesel is also a dead end once you do the math on the amount of land you'd have to dedicate to growing crops to make green bio-diesel out of to power even a part of the current diesel fleet, never mind converting the entire transport and personal car fleets to the stuff. There is no getting around the fact that EVs are the future, even if the 2nd coming of god in all of his orange glory would like to take us back to coal fired steam engines

          • There is no getting around the fact that EVs are the future

            Whatever. You keep telling yourself that while EV sales take a dive and governments keep handing out subsidies to drive sales.

            • There is no getting around the fact that EVs are the future

              Whatever. You keep telling yourself that while EV sales take a dive and governments keep handing out subsidies to drive sales.

              [citation needed]

              ... it should be easy to find if EV sales are experiencing a permanent and catastrophic global collapse.

          • Yeah, I meant clean diesel. That having been said green (as in bio) diesel

            Green diesel is refined lipids. Biodiesel is transesterified lipids. Stop conflating the two, it's confusing. Petrochemicals come from biological sources too, if you go back far enough, should we call all diesel biodiesel?

            is also a dead end once you do the math on the amount of land you'd have to dedicate to growing crops

            Nope. You can pump seawater into the desert near a salt flat, grow algae in it, use the lipids to make green diesel (or biodiesel, or some combination thereof) and use the rest to make butanol. Then you dump the salty wastewater into the salt flat. There's no need to grow crops on topsoil.

            • There is no getting around the fact that EVs are the future

              That's correct, but we literally cannot build batteries fast enough to put everyone in an EV any time soon, so liquid fuels will be with us for quite some time.

              I see that as a solvable problem.

              • I see that as a solvable problem.

                Technically? Sure. Realistically? I don't think so.

                Sure, it will be "solved" ... but slowly.

                (Barring some technological development which makes it much cheaper.)

                • I see that as a solvable problem.

                  Technically? Sure. Realistically? I don't think so.

                  Sure, it will be "solved" ... but slowly.

                  (Barring some technological development which makes it much cheaper.)

                  And converting every fossil fuel powered piece of equipment on earth to bio diesel is realistic?

                  • And converting every fossil fuel powered piece of equipment on earth to bio diesel is realistic?

                    No, it's simply unnecessary. Read up on green diesel [wikipedia.org]. Biodiesel presents special challenges, but green diesel doesn't. It's mature technology, and the fuel is a 1:1 replacement for petrodiesel in exactly the way that biodiesel isn't.

        • It is easy to make a clean diesel.
          Add about 30% water to it and an additive.

          Technology is well known since 30 years, but except for a few experimental ships, no one is using it.

          • It causes lubricity problems if you mix it with the fuel, and it doesn't mix well so that causes problems too. However, plenty of people are using water+methanol injection in their diesels. Water injection kits are not exactly hard to come by. You can get an EGT (set point controller) for about fifty bucks from Auber with an internal relay to trigger the spray kit's higher-power relay, which runs the pump. They might include it on stock vehicles if methanol were more available. It only helps when under loa

    • by sad_ ( 7868 )

      the benefit is that the car is still cheaper then you could manage as a company.
      say you could drop the price €1.000, the goverment subsidy will lower the price further without requiring you to take a loss.

  • where the electricity to charge all those cars is going to come from. They've pretty much built all the wind turbines they can in all the available locations and they plan to shut down their nukes. Somethings got to give.
  • Instead of subsidizing car owners, why not tax internal combustion engine car purchases? This will not only encourage people to switch to electric cars, but also encourage people to stop driving altogether, which presents an even greater benefit to society. As it is, this subsidy is just another corporate handout.
    • Because no one likes new or increased taxes. Instead they prefer subsidies which sound a lot nicer even if it amounts to the same thing in the end. Government taxes and spending are largely a larger more intricate version of find the lady. If you think they're playing fair you're a sucker.
    • by Izuzan ( 2620111 )

      They already do. Thats what the taxes on the gas you purchase is.

    • Because you would need an EU wide tax for that. Or I could buy my ICE car just in France or Netherlands and drive home with it.

    • by fazig ( 2909523 )
      Different countries tried that in various ways. For example by taxing fossil fuels, which is inadvertently passed down to the consumer by increased prices.
      That didn't go very well in France for example.

      Also what you might not know is that there have been bans for diesel cars (depending on emissions) in various large German cities. People don't like it and now and then demonstrate against the bans.

      So like the others already said, people prefer to have subsidies funded by the taxes they pay, where the fl
      • by tsqr ( 808554 )

        Different countries tried that in various ways. For example by taxing fossil fuels, which is inadvertently passed down to the consumer by increased prices. That didn't go very well in France for example.

        Yeah, but it went over very, very well in California. So well, in fact, that voters refused to repeal a 20 cent/gallon tax increase when they had the chance. And a year later, the governor is calling for an investigation into high gasoline prices.

    • Instead of subsidizing car owners, why not tax internal combustion engine car purchases?

      Because that would place the cost of such vehicles out of the reach of the people at the bottom of the economic ladder, and harm their economy. This handout to one of their largest employers (VAG) will promote it instead.

    • by AHuxley ( 892839 )
      The tax on EV is left off for now to make buying a EV seem "good".. for now.
      To make buying an EV seem like its "free market" freedom more reductions in price get offered by the gov.
      EV good, IC bad... so poor working people in the EU have to support EV by seeing their tax payments support the sale of an EV.
      A tax on the IC transport they have. A tax to make the buying of EV feel good.. while still using an IC...
      So buying a new EV looks and feels good. Just don't ask about who is paying for the gov offe
  • In the mean time, while waiting on the 2nd hand electric market to be established, I'll buy a 2nd hand diesel car. There will always be diesel - for agriculture.
    • Yea, I buy off-road diesel to use around my property. It doesn't have road taxes. It's expensive if I buy regular road diesel.
    • by sad_ ( 7868 )

      i don't know about the US, but in EU agriculture diesels run on 'special' diesel.
      it works just fine for your car as well, but they do random checks to see if you're not using the agriculture diesel for your car.
      and if you are, the fines are massive.

  • Germany's electricity grid is very carbon intensive so using electric cars there instead of modern internal combustion engine does not help much. In fact, i wonder if they do not have a negative environmental impact because the construction of the electric cars (not their operation) is more energy intensive than the ICE ones.

    In a country like France or Norway that would make more sense.

    But i guess the goal is just to subsidize the car industry so whatever.

  • Seriously, I am guessing that the 44.5K is just under what Tesla costs.

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