The Christian Social Union (CSU) is advocating that government subsidies for electric car purchases be subjected to additional conditions, specifically designed to ensure the benefits predominantly accrue to German manufacturers. Alexander Hoffmann, head of the CSU regional group, told Poltico’s industry and trade newsletter that current incentives disproportionately benefit non-European manufacturers. He asserted that the subsidy structure must be adjusted to ensure that the majority of the vehicles’ value chain is created within Europe.
Hoffmann proposed several models, including those with local-content requirements. He pointed out that other EU countries have already implemented similar measures, linking bonuses to criteria such as local battery production, material sourcing, or short transportation routes. In his view, if taxpayers’ money is used to promote EVs, that funding must also benefit the domestic industry.
This stance supports a demand made by CSU leader Markus Söder, who previously called for the electric vehicle premium to be revised in the autumn to benefit German producers more significantly.
Even auto expert Ferdinand Dudenhöffer supports reforming the EV premium this autumn. According to the head of the private research institute Center Automotive Research (CAR), the current premium is structured in a manner that works heavily in favor of foreign manufacturers. Dudenhöffer suggests that income limits should be abolished, and the introduction of price caps for vehicles should be considered.
The economist offered specific suggestions: electric vehicles priced up to €70,000 could receive a €6,000 subsidy, while those up to €100,000 might receive €4,000. For cars exceeding €100,000, he believes no subsidy is necessary. For plug-in hybrids, the subsidy should represent 50 percent of the premium; thus, a PHEV priced under €70,000 would be supported with €3,000.
The Federal Environment Ministry, which is responsible for the EV premium, stated in response to inquiries that any necessity for adjustments would be evaluated based on the accompanying success monitoring. Currently, there is no preliminary fixed plan for an overhaul of the funding guidelines. The Federal Government presented the EV premium in January 2026, and since mid-May, the federal government has been subsidizing the purchase or leasing of new electric cars for private individuals with a taxable household income up to €90,000, maximum benefit being €6,000.
