Hungary's government rolls out new subsidy scheme for EVs, e-scooters

Hungary's government rolls out new subsidy scheme for EVs, e-scooters
Government increases subsidy for cheaper EVs and scraps funding for cars over €42,000 price tag
By Tamas Szilagyi in Budapest May 21, 2020

The Hungarian government revised its EV subsidy scheme with HUF5bn (€141mn) funding available for fully electric vehicles (EVs) and scooters on May 20.  

To promote the spread of EVs the government introduced a flat HUF1.5mn subsidy in 2016 with a HUF20mn upper cap. Benefits for cars with a green license plate included free parking and the right to use the bus lane.

Reports surfaced earlier this year that the government would review the subsidy system  by withdrawing funding from high-powered hybrid SUVs and introduce a progressive subsidy scheme favouring cheaper, affordable cars. 

Under the new plan, subsidies up to HUF2.5mn will be available for EVs priced under HUF11mn. EVs priced between HUF11mn and HUF15mn are eligible for a maximum of HUF500,000 in support. Cars priced above the ceiling will not be entitled to state support. These include premium cars such as Tesla Models or Jaguar I-Pace.

The price advantage of combustion engine cars will disappear with the €7,000 subsidy for cheaper EV models, analysts said, who welcomed the increase in state funding at the low-end price range.

The most affordable zero-emission vehicle on the Hungarian market is Skoda CITIGOe iV at a HUF6.5mn list price, which will be available for HUF4mn with subsidies.

The government expects to see the stock of EVs rise by 1,000.

Since February, when the former subsidy programme ran out, car prices grew by 4-5% due to the rising logistics costs and the weaker forint.

Subsidies for vehicles to be used as taxis will be capped at 55% of the purchase price. The rate of subsidy for e-bikes will be the same up to HUF1mn, but it will only be available for delivery companies and sole proprietors.  

The government did not wish to support the purchase of e-scooters for private usage, according to the Ministry of Innovation and Technology responsible for the programme.

The government promised to simplify administration and speed up the application process and payout.