BERLIN -- Environmental groups hoping for more radical action to promote electric vehicles were disappointed at Germany's new coalition agreement, saying it falls short of what was needed to meet climate goals.
The agreement by the Social Democrats (SPD), Greens, and liberal Free Democrats (FDP) included raising Germany's target for the number of EVs on roads by 2030 to at least 15 million and supporting expansion of charging infrastructure.
But key policies which environmentalists had demanded to reduce emissions further -- such as a speed limit on highways and higher taxes on vehicles that emit fossil fuels -- were missing, organizations including climate think-tank Agora and NGO Deutsche Umwelthilfe (DUH) said.
A commitment to meet the European Union's proposal for an effective ban on carbon-emitting cars by "earlier" than the EU's goal of 2035 was seen as too vague.
"The transport sector section [of the agreement] violates the climate protection decision of federal courts," DUH said, referring to a ruling in Germany in May that the transport sector's emissions should be cut 50 percent by 2030.
"With what's written in that agreement, we will not achieve our climate targets," said Christian Hochfeld, director at think-tank Agora Energiewende.
Existential challenge
Germany's auto industry is facing an existential challenge from automakers in China and the United States in the global transition to electric cars.
Departing chancellor Angela Merkel was criticized for not pushing the country's automakers to adapt more quickly to the pressures of climate change.
But automakers and politicians have at times faced resistance from unions protecting the industry's 800,000 or so workers who fear that a quick and badly managed transition could cost tens of thousands of jobs.
Still, the presence of Germany's Greens in the new coalition meant climate advocates expected a clearer shift in policy, including harsher punishments for purchasing carbon-emitting cars.
A 6,000 to 9,000-euro ($10,000) subsidy for electric cars is in place until 2025 but the agreement did not state whether it would be extended.
Meanwhile, an existing tax on gasoline, heating oil, coal and natural gas consumption -- making combustion engine cars more expensive -- will not be increased, the agreement said.
"It's not clear how they will incentivize people to buy these 15 million EVs. You could give people money to buy them, or you can make CO2 more expensive. But they did not dare do that," industry expert Ferdinand Dudenhoeffer said.
BMW and Daimler welcomed the agreement's emphasis on expanding charging infrastructure, with Germany auto industry lobby group the VDA stating this was an area where Germany must "catch up and become significantly better on almost all fronts."
Still, Bernstein analyst Arndt Ellinghorst said EV subsidies would no longer be fruitful past 2025, as ultimately it was up to the market to offer more attractive and affordable models.
Signals like BlackRock's 700-million-euro investment in charging venture Ionity showed that private industry was filling the infrastructure gap, Ellinghorst said.
"I do not think we need the watering can from Berlin," he said. "This needs to be achieved by consensus across private industry sectors."
