The French government is working on a project to provide the poorest inhabitants with an electric car at a cost of 100 euros per month.
The proposal, first proposed by the Socialist candidate and mayor of Paris Anne Hidalgo and promised by newly elected president Emmanuel Macron during his first campaign speech on 17 March, would be added to a string of purchase subsidies that have caused sales of electric cars to soar.
For the first year, the target would be a budget of 50 million euros. This scheme would be added to a string of purchase subsidies that already exists in France to make the French citizens make the switch to the EV.
The aim of the measure is clear. The French government wants to reduce CO2 emissions on the roads and, at the same time, guarantee everyone mobility on four wheels even in the heart of the metropolis, where Diesel engines will soon be banned.
The most modest households would thus avoid old second-hand cars and be protected from the cost of petrol.
The French state, however, already subsidizes the purchase of EVs. Reaching up to 14 000 euros, these subsidies have however benefited the richest and most professional people rather than the modest households: the market is dominated by Tesla and Renault Zoé cars, which are much more expensive than their combustion counterparts.
500 euros per vehicle
The contours of this “social leasing’ must however still be specified. Macron’s campaign team had explained in March that this plan would be reserved for the socio-medical professions, young people, and the general public under conditions of resources.
It would target at least 100 000 leased e-vehicles per year, at an estimated cost of 50 million euros for the first year of the plan, or an apparently very small amount of 500 euros per vehicle.
It is not yet clear when the plan would be introduced, but it should be included in a rectifying finance law, explained the new Minister for Energy Transition Agnès Pannier-Runacher, who is in charge of the dossier. “It will be necessary to have a sufficiently robust system so that the French can benefit from it immediately”, she explained.
Push for smaller models
Manufacturers such as Renault, Hyundai, and China’s MG have recently launched long-term rental offers that could fit in with this measure. In particular, if the first rent is guaranteed by the Caisse des dépôts, or the “investment arm” of the French State, “for couples who earn the minimum wage or a little more”, as Macron has said.
Nissan, for example, offers its Lead at 99 euros per month over three and a half years, for a maximum of 30 000 km driven. Dacia offers its Spring at 120 euros per month with 40 000 km over four years, and an initial rent of 7 700 euros reduced to zero if the maximum public subsidy is applicable. With its 250 km range, the little e-car is already a great success and the waiting lists are getting longer.
On the Stellantis side, Fiat offers its small 500 from 119 euros per month with a 2 500 euros deposit, and Peugeot its e-208 at 149 per month with a 4 000 deposit.
More charging stations
However, production will have to keep up in the factories, as the car industry is severely hampered by shortages. For example, sales of new passenger cars in the EU in Paris were historically bad, although, in the first quarter of 2022 three times more EVs were sold worldwide than last year. And after years of decline, the cost of batteries is also likely to follow the rise in raw materials.
The government will also need to speed up the rollout of electric charging stations. Currently, France counts 200 000 public and private charging points, and only 6% of them are fast-chargers (+50 kW), although the French government has claimed its ambition to reach seven million charging points by 2030.
And of course, we have to wait and see how the French car industry will react to the proposed measure. The popular Dacia Spring, for example, is produced in China while French factories focus on mid-range electric vehicles. Two years ago, the French government allocated 8 billion euros in aid to the French automotive industry with the obligation to relocate to the home country, and bring back some assembly plants in France.
Learned from the lessons?
In Paris, the electric car-sharing program Autolib was launched back in 2011, precisely to benefit environmentally conscious people on low incomes. However, that turned out to be a flop with gigantic debts of 233 million euros.
The project, with some 4 000 Bolloré Bleucars and 1 100 charging points, suffered huge losses due to the declining quality of service and in 2018 the city, therefore, pulled the plug on the project for good.
After the disaster of ‘Autolib’, in conjunction with four different mobility operators, the city launched Mobilib’. This new car-sharing service aims at developing alternatives to private cars and reducing pollution. It works independently from other car-sharing services already active in Paris, such as Car2Go, Free2Move, or Renault.
It is mainly the current mayor Anne Hidalgo, also the advocate of this plan of 100 euros per month for a leased EV, who is committed to making Paris greener and more liveable.
Hidalgo was recently in the news with her controversial plan to replace one traffic lane on the Parisian ring road with trees in 2030. After the Covid 19-lockdown, the city has seen the largest ‘rebound’ in NO2 pollution among European capitals, followed by Brussels and Bucharest, research has shown. In August last year, 98% of all cars registered in France still ran on fossil fuel.