France’s social leasing for EVs could be expensive joke for Citroën

Citroën risks losing millions from the social leasing plan launched in France last year to encourage the switch to electric cars. The brand, owned by Stellantis, had until September 30th to deliver the vehicles ordered under that leasing plan. But Citroën is facing delivery delays.

According to French media, if the French state prevails, the automaker’s bill for the delay could reach about 14 million euros.

Agreements not respected

Under the social leasing plan set up in France, Citroën registered 5,800 orders for the ë-C3, quite a success. The model also scored so well due to its attractive price: 54 euros monthly installment. However, a condition was imposed for households to benefit from government support: the cars had to be delivered by September 30th.

And this is where the problem lies: because production of the model at the plant in Trnava, Slovakia, started later than planned last summer, Citroën has only been able to deliver 3,500 cars. In other words, 2,300 households are still waiting for their vehicles.

€13,800,000

Consequently, the manufacturer may have to pay the difference between the state subsidy of 13,000 euros for that social leasing and the ‘classic’ bonus of 7,000 euros for low-income households if the state does not validate the contracts, which amounts to 6,000 euros per car. As a result, the bill for the delay could reach several tens of millions of euros, i.e., about €13,800,000.

The issue comes at a rather unpleasant moment for Citroën. Several brand models are experiencing problems with faulty Takata airbags and had to be recalled. Some 102,000 cars have since been repaired, and some 128,000 will follow soon.