Cars | Minister Harakka does not rule out the continuation of the procurement support for electric cars

Transport- and Minister of Communications Timo Magpie (sd) does not rule out the possibility that the purchase subsidy for electric cars will continue in one form or another even after the additional funding granted to it in the spring has been used up.

The Finnish Transport and Communications Agency Traficom has estimated that the funds reserved for the procurement support for electric passenger cars will probably run out in September. Initially, additional funding of 9.5 million euros was granted in the spring for the 7.5 million euro procurement support, but currently 86 percent of the allocation has already been reserved.

Read more: The 2,000 euro purchase subsidy for electric cars may end as early as September – the money reserved for the subsidy is almost gone

The buyer of an electric car has been able to receive a purchase subsidy of 2,000 euros from the state when buying a new fully electric passenger car costing less than 50,000 euros.

According to Haraka, the processing of the procurement support case is still in progress and he does not want to open the details of the case.

“The issue is currently being discussed in the budget process,” Harakka told STT.

Expert Antti Hännenen according to Traficom, every month this year, approximately 800–1,000 applications have been received for support for the purchase of a fully electric passenger car. Based on the application, an appropriation is made for the purchase of the car, but the purchase subsidy of 2,000 euros can only be granted after the First Registration has been completed and the car has been handed over to the owner.

Due to the long delivery times of fully electric cars, purchase support has so far only been granted to around 1,400 fully electric car buyers.

“We have several thousand applications in the queue waiting for the buyer to receive their car. Many applicants will not receive their car and the purchase subsidy decision until next year,” says Hänninen.

Because the purchase subsidy is only aimed at buyers of a new car, it has been criticized for the fact that the subsidy is mostly only aimed at high-income citizens who can generally afford to buy a new car.

Leading researcher of the State Economic Research Center Marita Laukkanen does not knock down the criticism presented.

“In Finland, buyers of new cars are usually relatively well-off,” Laukkanen reminds.

Laukkanen would like research information on the effectiveness of procurement support. According to studies conducted on the subject in other countries, procurement subsidies have increased the demand for the cars that were the subject of the subsidy, but according to Laukkanen, fresh and Finnish research data on the subject would be needed.

“The risk here is that people buy an electric car with the purchase subsidy, which they had intended to buy anyway. If this is the case, then the subsidy will not bring more electric cars into traffic at all,” says Laukkanen.

According to Laukkanen, it would also be good to consider whether the purchase subsidy could also cover the purchase of a used fully electric car. In this case, the support would touch a wider part of Finns, because used cars are usually significantly cheaper than new ones.

Acquisition support In addition, the electrification of car traffic can also be supported by, for example, supporting the construction of car charging infrastructure.

According to Laukkanen, in the initial phase of electric cars, where we are now, it is good to support both the purchase of cars and the charging infrastructure.

“If we only support one, then there might not be enough of the other,” says Laukkanen.

According to Laukkanen, there is a need in Finland to find effective policy measures to promote electric cars.

“Finland’s climate goals require that the spread of electric cars accelerates from what it is now,” emphasizes Laukkanen.