2024-07-08 09:30:34
The market share of new electric vehicles reached 17% in France in 2023, compared to 2% in 2019. France Stratégie highlights the interest in continuing to better target aid towards low-income households to develop the market, particularly via social leasing.
For once, France is doing better than the European average. In 2023, the market share of new electric vehicles reached 17% in France in 2023, compared to 15% at the European level. The market is starting to take off, while new electric vehicles still only represented 2% of sales in France in 2019. But is support for the development of electric vehicles appropriate? This is the question answered by two economists in a new France Stratégie analysis note.
Welcome subsidies and a penalty
In France, public support for developing sales of electric motors is based primarily on purchase subsidies. This includes the conversion bonus and the ecological bonus, now reserved for fully electric vehicles only, and no longer hybrids, even rechargeable ones, whose purchase price does not exceed 47,000 euros. The support system also provides for a progressive penalty on CO2 emissions (for any vehicle emitting more than 117 gCO2/km) and a progressive weight penalty for thermal vehicles (and rechargeable hybrids from January 1, 2025) weighing more than 1.6 tonnes. In 2023, 37.7% of new vehicle registrations were subject to the penalty.
« The bonus-malus would explain 40% of the increase in the market share of electric vehicles from 2019 to 2021, and a third of the reduction in emissions from new vehiclessummarizes the opinion of France Stratégie. The cost to public finances would be 600 euros per tonne of CO2 avoided, or even 800 euros taking into account the resulting loss of tax revenue. »
The additional cost of purchase, a deterrent for low-income households
The system seems to be particularly appealing to individuals. Households represent 47.5% of new vehicle sales, but 65% of electric vehicle sales. The additional investment cost between electric and thermal city cars is recouped by gains in use of three to six years for a modest household eligible for the bonus and the conversion premium (compared to ten years for a “superior” household) “, calculates France Stratégie.
However, the additional cost of purchasing a new electric vehicle compared to a thermal one remains a barrier for low-income households. Despite a bonus of 7,000 euros compared to 4,000 euros for higher incomes, they only represent 15 to 20% of the bonus beneficiaries. The second-hand market, which concentrates most household transactions (85%), does not yet allow electric vehicles to be democratized for this segment of the population. Electric vehicles remain particularly rare there, since only 1.5% of the fleet is electric.
In this sense, France Stratégie sees electric leasing as “ a path to pursue ” to avoid a heavy investment for households. With 50,000 applications submitted by low-income households at the start of 2024, this is already more than the 30,000 ecological bonuses requested by this category of the population in 2023. France Stratégie adds: “For middle and upper-income households, it will be a question of finding the balance between increasing the penalty for thermal vehicles and reducing the bonus for electric vehicles. Public intervention would also benefit from targeting vehicles of reasonable size and produced with decarbonized energy. The environmental score represents an important step forward in this area. »
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