Mobility Portal, Spain
Date: January 2, 2024
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By Mobility Portal
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France excludes Chinese EVs from the Ecological Bonus, unleashing “threats.” What are the consequences?

The ecological bonus underwent modifications, and Chinese companies were excluded. As a result, the Asian giant "threatens" not to establish factories in France and to increase the cost of its batteries.
Macron France Xi Jiping China

Since the Decarbonization Plan was presented by the EU in 2018, the government of France has been implementing a series of measures to promote the sales of zero and low-emission vehicles within the country.

In this context, the legislation regarding the ecological bonus was recently revised, undergoing some modifications.

Specifically, authorities chose to favor the European industry by excluding Chinese electric vehicle manufacturers from incentives.

While industry representatives described this measure as “beneficial,” others considered it “discriminatory.”

A spokesperson for MG, owned by the Chinese SAIC Motor Corporation Limited, stated that “there are cars that will completely lose their competitiveness.”

Additionally, they explained that the company decided not to apply for the bonus for its MG4 model because it was “designed to exclude us.”

In the same vein, a representative from BYD opposed the new implementation, as reported by La Tribune.

“The more the government threatens us, the less we will want to establish a factory in France,” stated the source.

According to the French media, the Chinese group intends to raise the prices of its batteries as a countermeasure.

This would significantly impact the French automotive industry, since many companies use batteries produced by BYD in their units.

What modifications did the ecological bonus undergo in France?

Previously, the subsidies were intended for vehicles with a maximum weight of 2,400 kilograms and a cost of up to €47,000.

Now, the new condition is that vehicles must pass the estimated environmental score, with a minimum rating of 60 out of 80 points.

For this rating, the materials used, the environmental impact of assembly and origin, and the logistics of all components are taken into account.

“We will no longer subsidize the production of cars that emit too much CO2,” said French Finance Minister Bruno Le Maire in a statement.

Subsequently, the government published on its official website a list of brands and models that will receive the subsidy.

Some of them include the DS3, Hyundai Kona Electric, Nissan Leaf, Peugeot e-208, Renault Zoe, Tesla Model Y, Volkswagen ID.3, among others.

Under the previous regulation, a total of 500 electric vehicles could benefit from this financial support.

But, following the modifications, there’s only around 65% of EVs sold in France that remain eligible.

None of the vehicles manufactured in China are covered by this benefit, so it is estimated that this decision was taken as a defense mechanism against the high sales from the Asian giant.

It is no surprise that China has a powerful position in the global EV market.

Part of this success lies in the subsidies that the local government grants to companies to make production and market prices lower than average.

This makes the East Asian country a direct rival to European automotive industries.

On the other hand, it is worth noting that while Chinese automakers were affected by the measures, some brands belonging to the European Union were benefited.

Among the subsidized models are 24 from Stellantis and five from the Renault Group. These are the two companies most favored by the new rules.

On the other hand, a clear example of excluded EVs is the Dacia Spring manufactured in China, representing one in ten electric cars sold in France.

This model will experience a price increase, going from costing €15,800 to €20,800.

Some sources indicate that there are chances the French government will reduce the amount of the ecological bonus.

However, the information is not yet confirmed, and official announcements from the state sector are awaited.

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