Tempting, Germany Gives Incentives For Electric Cars To Reach IDR 77 Million

BMW electric car (doc. BMW).

JAKARTA - The German government has officially announced the return of the electric vehicle (EV) incentive program to support low- and middle-income people. This policy will take effect from January 2026 to the end of 2029.

The existence of this incentive aims to revive the national automotive industry which had weakened after the old incentives were suspended in 2023.

Chancellor Friedrich Merz said that the Government had prepared funds of 3 billion euros or around Rp. 51 trillion to support the program.

Through this new policy, buyers of electric cars will receive subsidies of up to 4,000 euros or the equivalent of IDR 77 million for the purchase of new vehicles at a price below 45,000 euros or around IDR 869 million.

Compared to the previous scheme, the Government cut the price limit for eligible vehicles from 65,000 euros to 45,000 euros. In addition, plug-in hybrid cars are no longer included in the list of incentive recipients.

However, for the first time, used electric cars will also get discounts in this new program. This incentive is also aimed at people with an annual income of around 45,000 euros.

The Secretary General of the Social Democratic Party, Tim Kluessendorf, emphasized that the transition to electric vehicles must be accessible to all circles.

"Everyone must be able to make a transition to electric vehicles," he said, as reported by Carscoops, Saturday, October 18, 2025.

Furthermore, Kluessendorf emphasized the importance of this policy to strengthen the local automotive industry.

"What is important for me in designing this subsidy program is so that the benefits are mainly felt by the automotive industry in Germany and Europe," he said.

The previous program, which took effect from 2016 to 2023, has distributed subsidies of more than 10 billion euros, but was eventually terminated due to budget constraints.

With the presence of this new scheme, the Government hopes that electric vehicle sales will increase again, while maintaining the competitiveness of German car manufacturers from foreign brand pressure, especially from China.