There France tries to copy the United States and announces that it wants to link the disbursement of the incentives for the purchase of electric carsorigin of the producing country, as the United States does under the Inflation Reduction Act. It is the first European country to introduce this restriction. Ironically, the US measure had been widely criticized by the EU, which had called it protectionist and discriminatory, and now one of the member states (the most influential with Germany) is preparing to do the same . Even though the source limit will only affect non-European production cars.

FRANCE AUTO INCENTIVES: FOR MACRON, WE MUST SUPPORT EUROPEAN INDUSTRY

French President Macron explained the new incentive system in a public meeting with entrepreneurs, managers and bureaucrats, organized to illustrate the much broader plan to accelerate the relaunch of transalpine industry from an environmental point of view. “We will be the first European country to review the criteria for awarding contributions“, declared the number one of the Elysée, “but that does not mean being protectionist: we will not close the market, but we do not want to use French taxpayers’ money to support non-European industry”. Indeed, in the first three months of this year, 40% of car premiums in France were used to buy electric cars made in China.

FRANCE: INCENTIVES ONLY FOR EUROPEAN ELECTRIC CARS TO CONNECT US AND CHINA

Macron’s objective, it is useless to hide it, is both to respond to Biden’s neo-protectionism and, above all, to curb theaggressive Chinese expansion on the electric mobility market: “I don’t want Europe to support batteries that are not produced on the Old Continent“, he said at the same meeting, “because neither the Americans nor the Chinese facilitate the batteries we produce”. However, for the French president, there can only be a truly effective reaction at European level, even if for the moment no partner country has responded to its requests. This circumstance prompted him to break the deadline and announce France’s reversal, in the hope that other countries would follow.

CAR INCENTIVES FRANCE, CRITERIA FOR AWARDING CONTRIBUTIONS

At the time of writing, there are still no details on the scheme of the new French automotive incentives, but news is expected in a few days. The measure will in any case have to obtain the approval of the Parliament of Paris and will therefore not be immediate (it will probably be discussed after the summer). Insiders predict that to avoid any accusations of protectionism, the ploy of considering the laws will be used emissions produced during purely industrial activities. In practice, discounts will only apply to cars produced using renewable energy sources, given the very strict limits of the level of carbon footprint (also for the production of batteries). This requirement would automatically exclude all Chinese automakers, given that 60% of China’s energy is generated from coal.