BMW: Incentives Key to Helping BMW i3, Other EV Sales Soar

Ever since it entered into production in 2013, the BMW i3 electric car and its twin — the BMW i3 REx range-extended electric car — has enjoyed strong sales across the U.S. and Europe, amassing more than 20,000 global sales to date.

BMW boss: Incentives are key to EV adoption.

BMW boss: Incentives are key to EV adoption.

In order for BMW i3 and other plug-in car sales figures to continue to rise however, continued support from governments around the world is needed to keep effective sticker prices low.

That’s according to BMW Group CEO Norbert Reithofer, who told journalists at BMW’s annual press conference last week that simply glancing at sales figures for each country around the world makes it abundantly clear which countries offer plug-in car incentives and which ones don’t.

“We can see a clear connection between sales figures and political initiatives,” he said. “Wherever governments offer tangible incentives for e-mobility, the registration figures for the BMW i3 soar.”

To prove his point, Reithofer cited California, where last year’s i3 sales totaled 3,000 vehicles — almost a half of all U.S. BMW i3 sales for 2014 — and Norway, where 2,000 BMW i3 electric cars were sold during 23014.

BMW says it's clear to see where plug-in incentives are offered just by looking at sales figures.

BMW says it’s clear to see where plug-in incentives are offered just by looking at sales figures.

In California, buyers are offered an additional $2,500 in state rebates for buying a plug-in car on top of the standard U.S. $7,500 Federal Tax Credit for buying a plug-in vehicle. In Norway, electric vehicles are exempt from sales tax, can legally drive in bus lanes, and are often allowed to park and charge for free in busy city centres like Oslo.

Germany, meanwhile, has no such incentives for plug-in cars, something that Reithofer says is all-too clear to see.

“The German carmakers have delivered their part of the bargain [to make electric cars],” he said. “The ball is now in the court of policymakers.”

Germany, like many other influential nations around the world, has pledged to work hard to encourage plug-in car adoption among its citizens, with the lofty goal of having 1 million electric cars on the roads of Germany by 2020.

Without incentives, plug-in car sales won't continue to accelerate, warns BMW.

Without incentives, plug-in car sales won’t continue to accelerate, warns BMW.

But despite the best of intentions from German Chancellor Angela Merkel and her coalition government, Germany hasn’t managed to make good its promise of introducing plug-in car incentives to encourage more Germans to switch to electric cars.

In fact, a recent attempt by the German federal government to provide corporate tax breaks to companies who purchase plug-in vehicles was shelved after state governments — whose funding would have suffered had the incentives been voted in — objected to the projected loss of tax revenue.

Without a deal between the German federal and state governments, it’s unlikely Germany will reach its 1 million plug-in vehicle goal in the next five years.

Do you concur with Reithofer’s analysis of sales figures versus incentives? Or do you think there’s a better way to drive plug-in car sales that has nothing to do with financial perks from local or national governments?

Moreover, should governments still be incentivising plug-in sales or not?

Leave your thoughts in the Comments below.

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  • MEroller

    ME thinks: Our government is afraid of the incredible success electric cars might have with incentives en par with California, let alone Norway. It would most likely disrupt one of our most successful industries, the automotive one, which still heavily relies on steam engines – ahem ICEs. nDespite most German automakers having their own special fully electric or electrified vehicles on trickle-sales by now, most if not all of them still strongly crave the combustion engines our automotive great-grandfathers Nicolaus August Otto and Rudolf Diesel came up with. If suddenly “fully electric” took off like in Norway maybe even I would loose my job, or I would have to reinvent myself professionally. nnSomehow I would rather prefer the latter 🙂

  • Guest

    It is also important to better educate the potential users of electric vehicles about the benefits of electric vehicles such as low mechanical costs, no combustion fumes, and lower noise emissions in the cities. This education is the duty of the car companies as they have huge marketing budgets.