France is launching a new round of its social leasing plan for the purchase of electric cars, aimed at lower-income households. The system was also launched last year, but was suspended after about six weeks because the budget was quickly exhausted as the number of validated orders was much higher than expected.

For this year, some changes have been made to the plan; however, the rules remain largely the same.

The budget provided is approximately 370 million euros, financed by energy saving certificates (CEE), in accordance with the polluter pays principle, targeting energy suppliers such as TotalEnergies, Engie, EDF, and others.

Not more than €200 per month

This time, a budget of 370 million euros has been set aside from the outset to finance 50,000 EVs, 5,000 of which are reserved for individuals who live or work in low-emission zones (LEZs). Last year, the original budget was for 20,000 to 25,000 vehicles, while more than 50,000 orders were received for the rental with the option to purchase an EV. Stellantis alone received more than 120,000 applications.

The idea is that people can rent an EV at a low monthly rate, from a minimum of €95 to a maximum of €200 per month, for a period of at least three years.

The distance from home to work must be at least 15 km

The contract does not consider options, insurance, or maintenance costs. Specifically, each applicant, who must be of legal age and reside in France, must have a reference taxable income of less than or equal to €16,300 per part (this was €15,400 in 2024) and commute to work by car more than 15 km from home, or drive more than 8,000 km per year with their own vehicle in the context of their professional activity.

You must also not have benefited from the scheme in 2024, and this time, the scheme is also open to the French overseas territories. The social leasing scheme can also not be combined with the ecological premium or bonus for purchase or rental, another subsidy for the purchase of an EV that is now regulated through the energy-saving certificate mechanism.

Purchase price up to €47,000

The electric models must also have a purchase price of no more than €47,000 (including VAT), the cars must meet a minimum environmental score, and used cars or cars converted to electric are not eligible.

Models from a dozen brands are eligible, including Peugeot, Citroën, Renault, Volkswagen, Fiat, Škoda, Ford, Hyundai, Kia, Opel, and Alfa Romeo.

Social leasing could once again be a great success, with the milestone of 50,000 vehicles expected to be reached within 5 to 10 business days. Renault, for example, has already announced that it has registered “several thousand” pre-validated files with its dealers. Meanwhile, interested customers who meet the criteria can only validate their application on the government’s online platform starting today.

In 2024, approximately 11,000 Renault cars took advantage of the scheme. This time, Renault is hoping to capitalize on the R5, R4, and Megane, starting at €120/month, while Stellantis is offering 17 models, including two for less than €100/month (Fiat Grande Panda and Citroën ë-C3).

Commercial impact

Another difference from last year, and more significant for dealers, is that the risk for them has been reduced. In previous years, dealers complained because they took the risk of never making a profit on these types of sales, because the trade-in value is too low when the cars are returned at the end of the lease contract.

This year, the manufacturer is also offering a buyback program for social leasing vehicles, which means that the manufacturer, rather than the dealer, assumes the risk of a low residual value when reselling a used car.

At the same time, there is still concern about the commercial impact when the 50,000 EVs from social leases are all returned to dealers, over a period from early 2027 to late 2028.

It could destabilize the market, just as last year’s low rental price of €54 gave a false impression of the value of an EV, which is why that amount has been raised to a minimum of €95/month, which still amounts to a subsidy of 7,000 euros for a household when you consider that a private lease usually costs €200-350/month.

Saving of €1,600/year

According to a study by Charge France, the association of charging operators, you can save up to 1,600 euros per year by switching from a combustion engine or hybrid vehicle to an EV.

It is still uncertain whether the social leasing plan will be renewed annually in France in the future.