Germany unveiled the draft federal budget for 2025, a topic that has sparked expectations and debates across various sectors, particularly in the automotive industry.
Minister of Economy Robert Habeck emphasized the stability and security promised by this budget for the country, especially following recent economic challenges.
In a significant move, Minister Habeck detailed the introduction of a special depreciation for company electric vehicles (EVs), retroactively applicable from July 1st and extending through the end of 2028.
The gross list price limit will increase from 70,000 euros to 95,000 euros for company car taxation in the case of EVs.
This will benefit models with higher base prices and costly optional equipment, providing a significant advantage to German manufacturers like Mercedes-Benz, Audi (Volkswagen), and BMW.
Vehicles powered solely by e-fuels will be compared to fully electric ones, particularly in terms of vehicle tax and company car taxation.
“We expect and trust that these measures will also be implemented,” indicates the Verband der internationalen Kraftfahrzeughersteller (VDIK) to Mobility Portal Europe.
This initiative, announced during the opening of Mercedes’ battery development center in Stuttgart, aims to stimulate demand for EVs among businesses.
According to Habeck, this special depreciation is part of the government’s budget commitment, though a legally secure regulation is yet to be established.
In addition to the special depreciation, an extension of tax benefits for more expensive EVs is also foreseen.
Similarly, the reaction from the German Association of the Automotive Industry (VDA) has been positive.
Hildegard Müller, president of the VDA, highlights to Mobility Portal Europe that “while the announced measures are welcomed, the key will lie in their effective implementation and financing.”
“In addition to announcements regarding bureaucracy reduction, improvement in depreciation conditions, and bonuses for research, it is also worth noting various initiatives aimed at a successful rollout of eMobility,” she emphasizes.
Not only that, but she also stresses the Federal Government’s aim to push forward an “ambitious free trade agenda,” especially amid the current EU-China conflict.
Following the European Commission’s announcement of provisional countervailing duties on EVs imported from China, Germany has been among the first to oppose this measure.
Why? Because one of the most affected by this decision could be German car manufacturers, the heart of the European automotive industry.
“This is a very central commitment that we welcome and support enthusiastically,” asserts Hildegard Müller regarding the economic minister’s announcement.
However, she also points out that the measures are not yet ambitious enough to strengthen Germany’s competitiveness and industrial location.
“Structural relief and necessary simplifications for businesses are still missing from the package, as well as an investment premium,” states the VDA president.
And she underscores: “The Federal Government should set more priorities here to ensure significant and long-term growth.”
The budget places a strong emphasis on expanding the electric supply
One of Germany’s current concerns is the potential collapse of the electrical grid, especially given the anticipated demand from electric vehicles.
In this regard, Habeck highlighted that significant decisions have been made to ensure a secure, clean, and affordable electricity supply in the long term.
The integration of renewable energies into the market is a priority, with a series of measures aimed at reducing costs and improving the efficiency of the system.
With bureaucracy reduction being a crucial point, especially for small and medium-sized enterprises, the goal is to make the adoption of renewable technologies easier and more accessible.
Simultaneously, ensuring that power supply remains secure even with a high proportion of clean energies.
“The extension of relief through the electricity price package is an important and correct signal,” underscores Müller.
However, she maintains: “But it lacks effective measures for battery production and competitive pricing for charging energy.”
