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Spanish transport association warns of 'debacle' without electric vehicle subsidies
Transport

Spanish transport association warns of 'debacle' without electric vehicle subsidies

According to Aedive, the recent temporary parliamentary rejection of the Ley Ómnibus put at risk billion-euro investments and a strategic part of the economic, industrial, business, energy and technological future of Spain

A. Noguerol

Madrid

Wednesday, 29 January 2025, 14:58

The recent rejection by the Spanish parliament of the 'Ley Ómnibus' (omnibus law) temporarily blocked extension of the Plan Moves III for the purchase of electric vehicles, fuel cells and charging points. The rejection also briefly led to the postponement of the 15 per cent deduction in personal income tax on the purchase of an electric vehicle until 31 December 2025. The measure was introduced in June 2024, along with a deduction of up to 80 per cent for the installation of charging points for private individuals.

This came as a shock to the main vehicle manufacturers and sellers in Spain, as well as to the members of the Asociación Empresarial para el Desarrollo e Impulso de la Movilidad Eléctrica (business association for the development and promotion of electric mobility) or Aedive.

The organisation, which brings together all the companies involved in the electric transport industry in Spain, was quick to call on politicians for rationality, clear-sightedness and quick agreements to reactivate an efficient incentive plan, similar to MOVES III, to maintain the commitments made by the companies to their customers and to give continuity to the commitment made by the government last December.

Following the government's announcement in December of the extension of MOVES III subsidies until June 2025, registrations experienced significant growth in January of 60% in battery electric vehicles, 36% in plug-in hybrids and 100% in the private vehicle channel, until the Ley Ómnibus was passed on 22 December, bringing the market to an almost total standstill.

According to Aedive, the temporary situation represented a real catastrophe in economic, industrial, business, technological, energy and environmental terms. The association also argued that it compromised the future of the automotive industry in Spain at a very delicate time on a geopolitical level, in which it is essential to promote, from a political point of view, certainty and predictability for investments and the market itself.

The legislative blockage would have made it impossible, according to their forecasts, to meet the objectives of the Plan Nacional Integrado de Energía y Clima (national integrated energy and climate plan), or PNIEC, which establishes 5.5 million electric vehicles on the roads by 2030. The association also argued that it puts at risk a private investment of close to 60 billion euros, which it says is necessary to reach these objectives, taking into account the impact on the entire value chain of electric transport and on the generation of employment in 22 different branches of activity, according to Aedive's recent study of the socioeconomic impact of electric transport in Spain.

Fiscal support measures

Apart from the reactivation of an efficient incentive plan, Aedive proposed a series of actions to boost the market:

1. In personal income tax: deduction of 21% of the purchase value of electric vehicles, with a maximum deduction base of 45,000 euros.

2. In personal income tax: deduction of 35% of the value of the installation of the electric vehicle charging point, with a maximum deduction base of 3,000 euros.

3. In corporate income tax: 35% deduction for the installation of public access charging infrastructures, up to an amount of 100,000 euros per charging point; and up to an amount of 200,000 euros if they incorporate back-up energy storage solutions.

4. Freedom of depreciation in the calculation of corporate income tax for all investments in zero-emission mobility, including electric vehicles and/or charging infrastructures.

5. Abolition of taxes on in-kind compensation for the use of company-owned or leased zero-emission vehicles, removing any limitation on the purchase price ceiling.

6. 2,000 euro scrappage voucher for use in electric shared mobility services (bicycles, motorbikes and cars).

7. Further improve the system of energy saving certificates (EPCs) in the field of electric mobility and speed up their processing.

The electric vehicle is a strategic project that not only represents a unique opportunity to improve sustainability and public health in Spain, but is also a driver of economic growth, technological innovation, energy efficiency and geopolitical independence, reducing the import of fossil fuels and generating its own clean, indigenous energy to power buildings, industry and mobility.

Spain is an extremely attractive country for investment linked to the electric vehicles due to its logistical advantages (46 ports) and for being a benchmark in the manufacture of all kinds of electric vehicles and automotive components, but also of recharging points and electrical equipment, gigafactories, battery recycling factories, battery storage with second life batteries, and reserves of lithium, cobalt, copper, nickel, aluminium and other strategic raw materials.

This guarantees a circular economy that is completed with the advance of new technologies; energy storage with second-life batteries, and reserves of lithium, cobalt, copper, nickel, aluminium and other strategic raw materials, which is completed with progress in new technologies, such as 5G, digitalisation and artificial intelligence.

Furthermore, Spain exports 90% of its car production to third countries that plan to end the marketing of combustion models between 2035 and 2040, which makes it essential to strengthen its industrial and technological chain in order to compete on equal terms with other markets.

At the same time, the automotive industry needs to increase sales of electric vehicles to avoid the multi-million dollar fines resulting from the requirement that the average emissions of their cars must not exceed 93.6 grams of CO₂ per kilometre.

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