Fossil Fuels vs Electric Dreams: Governments Spark Debate on Subsidy Reform

Norway’s largest car importer Harald A. Møller AS believes that the government’s proposals facilitate a comeback for fossil-fuel cars.

– We made the Volkswagen passenger car a fully electric brand already from 1 January this year, with the belief that the government also stood by the 2025 target. Now the budget negotiations and SV are the last opportunity to reach the electric car target, at the same time that we are forced to consider resuming the sale of Volkswagen’s passenger cars with combustion engines, says Ulf Tore Hekneby, CEO of Harald A. Møller AS.

The government proposes to freeze both the VAT limit and the one-off tax on electric cars, so they are not taking any new measures to ensure growth in the electric car market. At the same time, they will cut the traffic insurance fee for fossil-fueled cars.

Asking for political support

– The tax system as it currently stands allows for a fossil fuel share of 10 to 20 per cent. If the government is satisfied with that, we cannot sit idly by and watch our competitors frolic freely in that part of the market, says Hekneby.

He thinks it looks like the government has given up faith that politics works.

“The green transition that the government is planning must also take into account the increased living costs that large groups have experienced over several years”, the government explains the cut in the traffic insurance fee with.

– The selection is good enough now that all new car customers can choose a fully electric passenger car, but the fees must contribute to the political goals. So it must cost more and more to release than not to do so, says Hekneby.

– Simply Harry

The Norwegian Electric Vehicle Association believes that the government should do more to achieve the 2025 target, and that the cut in one of the taxes for fossil-fuel cars is a strange signal.

– This is an anti-environmental tax. It is simply harry that the government makes it cheaper to pollute, says Christina Bu, the general secretary of the Norwegian Electric Vehicle Association.

The fact that the fees for electric cars do not increase and that the VAT threshold remains the same is, however, important, emphasizes Bu.

– If we are to reach the 2025 target for emission-free new car sales and manage to cut emissions from the transport sector, it is important that the tax policy is fixed. The government should be praised for that, she says.

– Still favorable

SP’s parliamentary representative Sigbjørn Gjelsvik rejects the criticism.

– It will still be beneficial to buy an electric car, but there is no reason to punish those who still drive petrol or diesel cars, he writes in an email to NTB.

He claims Norway is still at the forefront of the world in transitioning to zero-emission cars.

– We have come a long way in the direction of the goal that has been set. This has happened, among other things, through significant incentive schemes. There will still be favorable arrangements for those who acquire an electric car in Norway in the future, he says.

At the same time, he believes that those who still need to buy a petrol or diesel car should be able to do so with a clear conscience.

– There are far greater climate challenges to tackle than a smaller proportion of new car sales being modern petrol and diesel cars. It can also be good for emergency preparedness that not all cars in Norway will eventually be electric cars, says Gjelsvik.

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2024-10-08 01:24:28
“A Step Backward in Norway’s Electric Vehicle Revolution”

In a shocking turn of events, Norway’s largest car importer, Harald A. Møller AS, has expressed concerns that the government’s recent proposals may actually facilitate a comeback for fossil-fuel cars. This move comes as a stark contrast to the country’s ambitious goal of going electric by 2025.

At the beginning of this year, Volkswagen’s passenger car division made a bold move by transitioning to a fully electric brand in Norway. However, the company now feels forced to reconsider this decision due to the government’s lack of support for the electric vehicle (EV) market. According to Ulf Tore Hekneby, CEO of Harald A. Møller AS, the government’s proposals on VAT limits and one-off taxes on electric cars are not enough to drive growth in the EV market. In fact, the proposed cut in traffic insurance fees for fossil-fuel cars may actually give them an unfair advantage over their electric counterparts.

This move has left many in the industry scratching their heads, wondering if the government has given up on its goal of a green transition. Hekneby argues that the tax system as it currently stands already allows for a fossil fuel share of 10 to 20 percent, and if the government is satisfied with this, his company cannot sit idly by while competitors reap the benefits of a less stringent market.

The government’s reasoning behind the cut in traffic insurance fees is that it aims to alleviate increased living costs for large groups of people. While this may seem like a noble cause, it is clear that the priority here lies with short-term economic gains rather than long-term sustainability. Hekneby aptly points out that the selection of electric vehicles is already robust, and the fees should be structured in a way that incentivizes the adoption of cleaner energy sources.

This development raises questions about Norway’s commitment to its ambitious electric vehicle targets. If the government fails to provide adequate support for the EV market, it risks hindering the very progress that has made Norway a leader in the field. As Hekneby so eloquently puts it, “the fees must contribute to the political goals.” If Norway is serious about reducing its carbon footprint, it needs to put its money where its mouth is and create an environment that encourages the adoption of electric vehicles.