Germany’s €3 billion electric vehicle subsidy programme will be open to all manufacturers including Chinese brands, with the government saying it sees no evidence of a flood of Chinese cars into Europe’s largest auto market.
“I cannot see any evidence of this postulated major influx of Chinese car manufacturers in Germany, either in the figures or on the roads,” Environment Minister Carsten Schneider said at a press conference on Monday.
“And that is why we are facing up to the competition and not imposing any restrictions,” Schneider added.
The decision contrasts with approaches taken in the United Kingdom and France, where subsidy programmes effectively exclude Chinese-made vehicles through environmental standards requirements covering battery production and assembly processes.
“I am convinced of the quality of European and German brands,” the Environment Minister defended.
While Chinese manufacturers can access the subsidies, they still face European Union tariffs on imported EVs.
Chinese Sales Still Marginal
Chinese automakers remain a small presence in Germany despite rapid growth.
BYD sold approximately 23,000 vehicles in the country in 2025, achieving a market share of less than 1%.
The Shenzhen-based company reached a monthly record of 4,109 registrations in December.
XPeng saw German sales rise 330% year on year in December to 426 units, bringing its full-year total to 2,991 vehicles.
Monthly sales climbed steadily through the year, from 94 units in January to 426 in December.
Leapmotor, backed by Stellantis, sold 851 vehicles in Germany last year.
By comparison, Volkswagen accounted for 102,339 battery electric vehicle sales in Germany in 2025, followed by BMW with 51,878 units and Skoda with 50,823.
Programme Details
The subsidy programme, first outlined in October, is expected to support purchases of around 800,000 vehicles through 2029.
Incentives will range from €1,500 to €6,000 depending on household income, family size and vehicle type, with a focus on low- to middle-income buyers.
The base incentive is €3,000 for battery electric vehicles and €1,500 for plug-in hybrids and range-extended vehicles, Schneider confirmed on Monday.
All vehicles registered as new since January 1, 2026 qualify retroactively.
The income threshold is set at €80,000 in taxable annual household income, rising by €5,000 per child to a maximum of €90,000.
Chancellor Friedrich Merz’s coalition has also extended a tax exemption for EVs through 2035, at an estimated cost of €600 million in lost revenue through 2029.
