The French government has unveiled its new plans for subsidizing the electric transition. Next to the details of the social lease at €100 per month for households with a fiscal income inferior to 15 400 euros, it also published the final list of cars eligible for the new Ecobonus.

Windfall for the local manufacturers as Paris excludes the Chinese brands. Still, it draws in multiple ‘victims,’ as electric cars from other Asian brands, such as those produced in Korea or Japan, are equally blocked, including French cars made outside Europe, like Renault’s Dacia Spring.

Priority for those living far from work

For the ‘social lease’, an election pledge by President Macron, a particular leasing platform will come online from this Friday, to be operational from January 1st. Cars eligible for leasing at €100 to a maximum of 150 euros per month are the Peugeot e-208, Renault Twingo e-Tech, Citroën ë-C4, Opel Mokka Electric, or Fiat 500e to start.

Only French with the lowest incomes are eligible, with priority for those actually driving more than 8 000 km yearly or those who have to drive to work and live at least 15 km away.

The playing field is clearly drawn

The playing field is now clearly drawn for the rest of the potential EV buyers in France. The French government disclosed the beneficiaries – and victims – of the revised ecological bonus designed for new electric vehicles, commonly called the ‘electric bonus’.

While the financial incentive, currently ranging from 5 000 to 7 000 euros, remains unchanged, purchasing a Chinese-made electric vehicle with a government discount will be off the table after December 31st.

This was forecast as the rise of Chinese automakers in countries like France was driven by their cheaper production, better access to critical materials, and much-debated but still-to-be-proven aid from Xi Jinping’s administration.

Spring bites the dust

The dam erected by Paris is, of course, a protectionist move primarily aimed at China. Still, it draws in multiple ‘victims’, as electric cars from other Asian brands, such as those produced in Korea or Japan, are equally blocked.

These were left in the shadows for some time, but Macron’s government has now made a decisive stance: vehicles manufactured outside of Europe will no longer qualify. That is bad news for Toyota, Hyundai, Kia… and Renault.

However, models like the Czech-made Hyundai Kona Electric, the Toyota ProAce produced in France, or the UK-built Nissan Leaf and Townstar remain in the running.

Of all the models eligible today, some 30% lose their benefits. That includes the Dacia Spring from the Renault Group, exclusively built in China, a popular EV in France, and the current price beater in the EV landscape. Tesla can only qualify with the Model Y units built in Grünheide, Germany, as it loses its sales booster Model 3 incentive.

Further requirements need to be met to comply with the bonus. The model price may not exceed 47 000 euros, and the weight must be lower than 2,4 tons.

BYD to manufacture in Europe

Among the winners are the upcoming Renault R5, expected for 2024, and the recently launched Citroën ë-C3, the pioneer in modern affordability. The purchase price of both models will drop to around 20,000 euros, and lower, under the current scheme, undercutting by a fair margin the current leaders in price-beating EVs like Chinese MG; with its model 4, it has the fourth best-selling electric car in France.

The Chinese manufacturers express disappointment, denouncing what they call biased criteria targeting Asian production without apparent ecological justification. The government further fuelled these concerns, leaving specific calculation methods applied to the incentive unclear.

The environmental score pivots around four main CO2-based criteria: vehicle material production, battery manufacturing, car assembly, and transportation. But their exact weight and proportions aren’t precisely known so far.

Currently, there are no Chinese brands manufacturing passenger cars in Europe. But that is soon about to change. BYD will announce its first car factory in the EU within the coming weeks. The tailwind provided by the French government could make for a temporary headstart only.