French Government Slashes EV Incentives Amidst Budget Constraints

Recent years have seen a massive boom in electric mobility, particularly electric motorcycles and scooters. It was a two-way arrangement, really, as manufacturers were eager to jump on an emerging trend. Meanwhile, governments all over the world were quick to incentivize these EVs in a bid to encourage more sustainable mobility.

Unfortunately, the landscape has changed quite a bit. And now, we’re seeing a lot of e-bike, e-scooter, and e-motorcycle manufacturers go under. It also looks like things for the lightweight EV sector aren’t getting any better, at least not just yet.

You see, over in France, the government just rolled out Decree No. 2024-1084, and it’s one that’ll surely have EV enthusiasts disgruntled. The new decree covers quite a lot of electric mobility options ranging from cars to motorcycles and even bicycles, but in a nutshell, it either significantly reduces or completely eliminates the government subsidy for the purchase of electric vehicles.

When it comes to new electric passenger cars, the subsidy will now only be from 2,000 euros to 4,000 euros (about US $2,098 to $4,196), as against the previous 4,000 euros to 7,000 euros (about $4,196 to $7,343)—quite a hit for folks looking to save a few bucks by going electric.

But it gets worse.

The new decree completely removes the incentive, also known as an ecological bonus, for both electric two- and three-wheeled vehicles. Electric bicycles, like the super utilitarian e-cargo bikes and ultra-practical electric commuter bikes, are part of the equation, too. And apart from being a total wet blanket for active mobility enthusiasts, this could have a massive negative effect on the European bicycle industry.

Indeed, industry experts were quick to point out that what the government has done is essentially a death sentence to many up and coming e-bike manufacturers that have called France home. Back in 2017, when the subsidies were first introduced, the bicycle market saw a doubling of sales, as bikes—both electric and otherwise—became more accessible than ever before.

In an article by Bike Europe, the Alliance for Cycling expressed its disdain on the elimination of subsidies for electric two-wheelers in France. In a statement, it said: “The subsidy program is crucial for the cycling industry in France which is making significant steps forward to relocate the production. The bicycle industry is currently in difficulty, with a 24 percent decline in bicycle production volumes in France compared to 2022, and bicycle sales are down by 13 percent.”

And as for why the French government is slashing its EV incentives all of a sudden, well, according to Reuters, the move is part of a wider range of initiatives geared to control additional expenses due to budgeting constraints moving into 2025. It’s a bad situation that’s making an already unfavorable situation worse for pretty much the entire EV industry.

What’s scary here is that governments, organizations, and businesses alike all over the world are always looking for ways to cut costs. And perhaps, France cutting EV subsidies sets a massive precedent for other countries to follow suit. We’re expecting a similar move in the US—perhaps one that’s even worse, once Trump takes office on January 20, 2025.

So, to any EV enthusiasts reading this story, it certainly looks like things are gonna get a bit more difficult for you guys in the near future. If you're in France, or you otherwise have thoughts about this change in policy, share them in the comments below.