Observe, enlighten and decipher the evolution
of consumption patterns in France and abroad
Section 1 - The mystery of the electric car

The power of the public authorities

7 minutes of reading
In order to shift the boundaries, develop a new sector and change buying habits that have become established over more than a century, public policies are essential.

International awareness

Given the current situation, public policies are not always clearly understood, although this is the consistent expectation of 70% of the people interviewed for this study.



There are schemes to promote the electric vehicle, albeit on a variety of different scales. At the European level, Euro standards require manufacturers to reduce pollutant emissions from «tank-to-wheel», which in fact favours the EV. At the national level, most countries also promote the development of EVs using both coercive and incentive measures. The most polluting vehicles are discouraged by high taxes and low quotas while the registrations of clean vehicles like EVs are supported by various forms of subsidies.

Financial support for the transition

Most of the support measures concern allowances and subsidies to reduce the difference that still exists between the cost of an EV and its fossil fuel equivalent. Support schemes to finance charging station infrastructures and the implementation of public and shared e- mobility systems are also needed.

Today, the development of the electric vehicle cannot be done without strong and lasting financial incentives. «Indirect» support such as free urban tolls and car parks, or access to dedicated bus lanes, could provide the needed impetus. In Norway, there have been multiple ambitious public incentive measures. Public subsidies have made EVs cheaper, while urban regulations have granted them many car parking spaces and facilities. As a result, EVs now account for 21% of total sales. In contrast, when the subsidies are removed or reduced too quickly before the cost to run electric cars has dropped below that of fuel-powered vehicles, the sales growth stops. This is what happened, for example, in Denmark.

Comparative economic performance of EVs

Comparing the total cost of different energy solutions is not easy.



Many parameters have to be taken into consideration: purchase price of the vehicle (including tax), maintenance costs, fuel or electricity usage expenses, depreciation and resale value on the second-hand market, etc. For a product that is still relatively new and rare on the market, such as the EV, the future value and second-hand prices can only be estimated approximately. Most of the comparative studies, however, indicate that the total cost (i.e. purchase cost plus running costs) of EVs is still higher than that of fuel-powered vehicles, but that this cost is shrinking rapidly. The European Consumer Organisation concluded that in a comparison between the fossil fuel Opel Astra and the fully electric Nissan LEAF, the total cost of the latter was 8% higher in 2015. This difference will drop to 4% in 2020, and then to 1.5% in 2025, to represent only 0.5% by 2030.

The changes in the price of oil and its taxation as well as the fall in the price of batteries, which account for half the price of an EV, will determine the exact rate of convergence. Obviously, these results deserve to be broken down by type of user, especially according to the annual mileage.



The higher it is, the greater the incentive will be for the motorist to bear an additional cost on buying the vehicle in order to recover the cost during its use.

To smooth out these ongoing price differences when buying a vehicle and resolve the uncertainty associated with the residual value of an EV and its battery, long-term leasing, with or without an option to purchase, can be a great alternative to the conventional option of buying the car outright. The investment is smoothed out over time, the maintenance costs are known in advance and the distributor is contractually liable for the residual value of the EV.

It’s time to charge

Because the battery of the electric vehicle must be regularly recharged, having access to a charging point is an advantage. For people living in a house, it is easy to install a charging device, and particularly easy to recharge a vehicle overnight. For the residents of a block of flats, it will be preferable for the car park to have a network connection. If this is not the case, the regulatory framework could facilitate this. Another option is to recharge the battery at the workplace. Here again, appropriate regulations and taxation would speed up the deployment of charging points in the corporate world.

However, having access to a charging facility at home or at the workplace will be insufficient to fulfil every need – particularly that of reassuring those who are more concerned about running out of power. Given the current range limitations and the impossibility of replacing an empty battery with a full battery, it appears that a road charging network will have to be deployed to reassure those who are hesitating to get an EV and those motorists who need a single vehicle for every type of journey. What’s more, such an infrastructure will require particular specifications. Ideally, quick – and therefore more expensive – charging stations will be required, especially on motorways. Then, a typical «chicken and egg» problem arises. Charging stations will only be installed if enough EVs plug in to make them profitable, but there will only be enough EVs if there are enough charging facilities on the roads… The public authorities must, once again, take measures to bear some of the risk and costs borne by the motorway operators and energy providers. In 2016, the number of public charging points increased at the same rate as the number of EVs on the roads. The vast majority of EVs were being recharged on private roads.



Facilitating e-mobility systems

The experts agree that the EV will be all the more attractive economically and environmentally if it is used intensively. We’re thinking of the last mile when delivering goods in a city, the shared fleets of company vehicles or even those used for shared mobility services (carsharing fleet). Thus, the coordination and structuring of public policies at the national and local level – cities and urban hubs – are essential for the promotion and development of the EV. On the one hand, the increase in volumes generated by these shared EV offers will reduce battery production costs through accelerated economies of scale. On the other hand, it will prepare public opinion and motorists and get them used to the idea, thereby influencing their future personal choices.

Current examples of policies to promote electric vehicles

  • Exemption from acquisition taxes and indirect taxes from 5,100 to 8,700 USD.
  • Local subsidies capped at 50% of the amount granted by the state subsidies.
  • Starting in 2017, 20% reduction in 2016 subsidies, with the option to adjust this policy according to the impact on the market until 2020.
  • In 7 major urban centres, the restrictions on electric vehicle number plates have been lifted.
  • Locally, bus lanes may be used except at peak times, and the tolls and parking spaces are free.
  • No-claims bonus model based on CO2 emitted per km: €6,300 no-claims bonus for EVs with a battery and €1,000 for plug-in hybrid vehicles, up to €10,000 for EVs with a battery and €3,500 for plug-in hybrid vehicles when replacing an old diesel vehicle.
  • Tax credit for companies buying electric cars.
  • Exemption from taxes on electric and hydrogen vehicles.
  • Starting in 2017, 50% of the government’s fleet of vehicles is to be replaced by electric vehicles.
  • €4,000 discount on the purchase of a battery EV and €3,000 discount on plug-in hybrid vehicles, for up to 400,000 vehicles until 2020 or €600 m of subsidies.
  • The car manufacturers will finance 50% of the subsidy, while the government will finance the remaining 50%.
  • Exemption from road tax for 10 years and then for 5 years from 2021.
  • Reduction in taxes on company vehicles.
  • Locally, free parking and access to bus lanes.
  • Purchase subsidies according to the battery capacity (e.g. the Nissan Leaf 30 kWh battery: 3,000 USD).
  • Locally, exemption from paying tolls and access to restricted traffic lanes.
  • Exemption on the purchase tax: 11,600 USD.
  • Exemption from VAT on EVs with a battery (25% of the price of the vehicle before tax), including for EVs with a leased battery. Purchase discount on plug-in hybrid vehicles.
  • Exemption from road tax, tolls and ferry charges.
  • Continuation of this policy on EVs with a battery until 2020.
  • Since 2016, the free parking measures for electric vehicles have been managed by the town halls.
United Kingdom
  • Subsidy model based on the CO2 emitted per km and the zero-emission vehicles (5,800 USD for the EVs with battery, 3,300 USD for the plug-in hybrid vehicles).
  • Tax benefit: exemption from fuel taxes and import taxes for EVs and reduction for plug-in hybrid vehicles, reduced taxation for company vehicles.
  • Government expenditure plan of more than 770 million USD between 2015 and 2020 to encourage the production and purchase of Ultra-Low Emission Vehicles (ULEV): target of achieving 100% sales of new zero-emission vehicles by 2040.
  • «Go Ultra-Low City» model: measures to support very low emission vehicles in several cities including London (free parking, access to bus lanes, etc.).
United States
  • «Corporate Average Fuel Economy» (CAFE), a regulation designed to improve the average fuel consumption of vehicles that will provide bonuses for EVs.
  • Tax credit of 2,500 to 7,500 USD capped at 200,000 units sold per manufacturer.
  • Mandate to produce zero emission vehicles in 9 states.
  • In some states, purchase discounts and tax exemptions.

Much more than just protecting the environment

Whether it is saving the planet, improving air quality in the cities or reducing the dependence on oil without simply transferring this dependence onto another energy source (e.g. nuclear), there are many challenges to overcome that are of utmost importance for governments. However, the plan to build up an electrical sector while another is dismantled (i.e. the fuel-powered vehicles) will take time and must be managed with skill. Otherwise, the European car industry could, for example, suffer from the decline in its sales of fuel-powered vehicles as they are replaced by EVs imported from China… the Middle Kingdom is driving this market more than any other country in order not only to improve the air quality of its cities, but also to impose its industrial clout in this sector.

Sub-section 1
Environment: from promises to real action
Thanks to its specific technical features, it would seem that electric vehicles (EV) can provide a solution to some of the issues facing the environment, the economy, industry and society. However, th
Sub-section 3
An unavoidable enterprise for the automotive industry
For an increasing number of countries and cities, the days of the fuel-powered vehicle are numbered. The Netherlands in 2030, Scotland in 2032, France in 2040 and Paris 10 years before that. All over