Social leasing: How access to electric vehicles can be achieved even without a high income

Climate protection in the transport sector can only succeed if electric vehicles are affordable for all population groups that are dependent on a car. A recent study conducted by Oeko-Institut on behalf of Transport & Environment shows that a social leasing scheme can be a useful component in a package of measures for a socially just transition of the transport sector. To achieve this, low-income households must be given targeted support in switching to electromobility – especially when there are no attractive alternatives to owning a car.

The study examines the scope of a possible social leasing scheme and questions of administrative design and possible employment effects in the automotive industry.

Social leasing as a building block for affordable electromobility

France provides an example of a successful social leasing scheme: eligible people can lease an electric vehicle in France for as little as 50 euros per month. The target group is people with lower to medium incomes and those who have a work commute of at least 15 kilometers or a mileage of more than 8,000 km per year in a passenger car they drive within the scope of their job.

The researchers emphasise that a social leasing scheme should be adapted to the needs of the population. Important factors include the income threshold for access to the scheme, the type of vehicles supported and regional differences, e.g. in the availability of charging infrastructure and alternative means of transport.

Implementation of a social leasing scheme in Germany

However, from an administrative perspective, the French model of social leasing cannot be transferred without adjustment to Germany. The study thus also examines who can apply for funding, when, how and to whom, and what legal requirements need to be observed. The experts recommend, for example, that the funding should be administered by the German Federal Office for Economic Affairs and Export Control.

Demand orientation is decisive – small cars and mid-range vehicles are relevant

The analysis for Germany shows: Low-income households are more likely to own older vehicles and do not only drive small cars – even if their use is usually associated with lower costs. The analysis indicates that a pure leasing offer for small cars would not cover all needs. In order to create acceptance and meet actual transport needs, the scheme could also include mid-range vehicles for certain groups, such as families.

Limited effects on the used car market and on jobs

If 100,000, 50,000 or 30,000 vehicles are subsidised in one year, the effect on the total number of used cars available in subsequent years is limited. However, if individual vehicle segments are considered, the effect can be significantly greater, e.g. for vehicles in the mini to mid-size class. Interviews conducted with experts in the automotive industry also show that with up to 100,000 subsidised vehicles per year, only minor effects on jobs are to be expected in the German automotive industry.

Charging infrastructure as a hurdle and an opportunity

In Germany, the implementation of a social leasing scheme could be accompanied by a suitable promotion of charging infrastructure. To date, low-income households living in apartment buildings have had less access to private charging points. Targeted funding – e.g. in the form of subsidies or low-interest loans – could lower the barriers and facilitate the private use of electric vehicles. Above all, it is important that the funding actually reaches economically disadvantaged households.

Study 'Analysis of the implementation of a social leasing scheme in Germany' by Oeko-Institut