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Business

Berlin rejects buyer's premium for electric cars

Germany's transport and economy ministers have ruled out state-funded premiums to encourage car buyers to switch to electric vehicles. Their rejection coincides with government talks with the auto industry in Berlin.

Transport Minister Peter Ramsauer and Economy Minister Philipp Rösler said on Monday they did not think offering a state-subsidized premium to prospective buyers would go a long way towards stimmulating sales of electric cars.

In 2008, Germany set a target of having one million electric cars on its roads by 2020 and said back then it wanted to turn Germany into a pilot market by 2014.

But, at the beginning of this year, Germany had only 4,500 electric vehicles among its total fleet 43 million registered cars.

On Monday, Rösler said he did not believe in the magic of a buyer's premium to boost sales.

"Only the market itself and competition are the best drivers for innovation," Rösler told the daily newspaper Rheinische Post ahead of Monday's electro-mobility summit with Chancellor Angela Merkel in the chancellery in Berlin.

Pedaling back?

Transport Minister Ramsauer told the tabloit newspaper Bild that the ball was in auto industry's court to make electric cars more attractive to potential customers.

"As long as I'm in the government, there won't be any buyer's premium," he said.

"It hasn't led anywhere in countries where such a premium was introduced, like in the US or France," Ramsauer said.

Rösler and Ramsauer agreed that current sales figures were disappointing. They stated that electro-mobility was still in its infancy and said joint efforts would be required to achieve a breakthrough.

The government has been financially supporting research in the field and offering tax incentives to electric car drivers.

The head of the Federation of German Automobile Industry (VDA), Matthias Wissmann had said earlier in the year that German manufacturers would be able to offer 15 different models of electric vehicles by 2014.

hg/ipj (AFP, dpa)