France Slashes Electric Vehicle Subsidies in Major Policy Shift

The government announces immediate reductions to EV purchase bonuses, citing budget constraints, with significant impacts on the auto industry and consumers.

The maximum bonus for purchasing an electric vehicle is reduced from €7,000 to €4,000 for low-income households, with wealthier buyers now eligible for only €2,000 or €3,000 depending on income.
The changes, effective immediately with the publication of a government decree, aim to cut the EV subsidy budget from €1.5 billion in 2024 to €700 million in 2025.
The government has discontinued the 'prime à la conversion,' which provided additional incentives for trading in older, polluting vehicles for cleaner models.
Industry leaders and automakers warn the reductions could harm EV sales and competitiveness, particularly as Chinese manufacturers gain market share with heavily subsidized vehicles.
A revised version of the 'leasing social' program, offering subsidized EV leases for low-income households, will continue, though with scaled-back funding and adjusted terms.