Tesla Model S excluded from EV subsidy in Germany

The Tesla Model S is not eligible for the EV grant in Germany any longer as Tesla is suspected of subsidy fraud. The Federal Office for Economic Affairs and Export Control investigates.

++ This article has been updated. Please scroll below. ++

Never try to trick a German authority, or attempt to bend the rules even a little as it may have strict consequences once you are found out. This is the lesson Tesla is learning the hard way in Germany at the moment, where the Federal Office for Economic Affairs and Export Control (BAFA) has excluded the Model S from its list of plug-in vehicles eligible for subsidies. The 5,000 euro plug-in grant, also known as “Umweltbonus” (environmental grant) applies to electric cars that cost no more than 60,000 euros net and it is this regulation Tesla wanted to outmaneuvre.

The investigation by BAFA reacts to allegations first made by Germany’s leading red top newspaper Bild. Undercover reporters had tried to buy a Tesla Model S in the basic version as it is the only trim level that stays within the 60,000 euro limit.

It turned out, however, that while Tesla had listed a version to that price, in reality, it is not available. Too many essentials were missing that the EV maker had packaged as optional “extras” such as the rearview camera, park sensors, or lane-keeping assistant. When asked by the journalists, a Tesla sales representative admitted that said base version only served to get the Umweltbonus.

The Federal Office for Economic Affairs and Export Control (BAFA) responsible for handing out the incentive is now on the case. On its latest published list of cars eligible for the grant, Tesla is missing already.

Update 03 May 2021: Tesla has lost a case against the German Federal Office of Economics and Export Control (BAFA) at the Frankfurt Administrative Court. As reported above, BAFA had removed the Tesla Model S from the list of eligible electric vehicles after it was determined that the 2017 base model, which had been pushed to less than 60,000 euros net, was not even available in this form. Tesla had then taken it upon itself to “reimburse” about a thousand customers who had to pay back the eco premium at the time, i.e. payments of a total of around two million euros.

Tesla had then attempted to sue BAFAS into taking over the payments, claiming damage. However, the administrative court now ruled that this was a voluntary obligation to pay the subsidy. Voluntary in this case means that no damage to Tesla was directly due to the deletion from the list. Tesla was not obligated to take over the promotion itself, the judges said. Thus, Tesla itself created the financial disadvantage complained of.

Incidentally, the court also dismissed two lawsuits filed by Tesla buyers from whom BAFA had demanded the unjustly obtained subsidy back. Both rulings remain open to appeal.

autobild.de, Full list (pdf), automobilwoche.de (injunction, in German), automobilwoche.de, verwaltungsgerichtsbarkeit.hessen.de (update 03 may, all in German)