The end of €100/month leasing
So this is the end. The French government has decided to put an early end to this first 2024 edition of social leasing. They enabled low-income households to access an electric car for around €100/month. A decree is expected and will be published in the Journal Officiel. However, this does not mean that the scheme has come to an end, as the Élysée has assured us that social leasing will resume at the end of 2024 for the year 2025.
The scheme was a victim of its own success just one month after launch, exceeding its targets for this year. The figures speak for themselves: by the end of January, over 90,000 people had applied for a social leasing electric car through the scheme. One month on, around half of all applications have been approved (more than 50,000 orders), well in excess of the 20,000 to 25,000 electric vehicles the government had set itself.
Budgetary reasons for the shutdown?
Social leasing is one of the key measures in Emmanuel Macron's election program. It offers the most modest households earning a maximum income of €15,400 the possibility of signing a lease contract lease with purchase option (LOA) for €100/month for an electric electric city car type Peugeot e-208 and €150/month for a larger electric SUV like the Renault Megane e-Tech. However, to be eligible, certain conditions must be met:
- drive more than 8,000 km a year or live more than 15 km from work,
- maximum assistance of €13,000 per car, via the ecological bonus (€7,000) and an additional premium of €6,000,
- minimum rental period of three years, renewable once.
Some flagship models were more successful than others. The Stellantis Group, for example, took particular advantage of the offer by proposing the Peugeot e-208 and Fiat 500ᵉbut also larger models such as the Jeep Avengerfor a total of 30,000 electric cars at the beginning of February. For its part Renault offered its Twingo e-Tech and Zoé e-Tech at end-of-career prices, as well as its electric vanthe Kangoo Van e-Tech.
This has had the effect of increasing its market share thanks to social leasing, says brand manager Fabrice Cambolive. As a reminder, only electric vehicles built in Europe are eligible for this bonus. But among the models supported, only the largest are produced in France, such as the Renault Mégane e-Tech or Opel Mokka-e.
Initially, with no end date in sight, the budget got the better of social leasing. The bill amounts to 650 million euros for this year alone, far too high considering the 1.5 billion euros allocated to financing the environmental bonus and the conversion bonus. France's Minister for Industry, Roland Lescure, assured us on Sunday that validated orders will be honored.
What next?
Announcing the end of the social leasing program for 2024, the Elysée expressed its satisfaction with the success achieved by this initiative when it was launched. " Of the 100,000 vehicles that French people eligible for leasing would normally acquire each year, 50,000 will be electric this time. This represents a significant success for French-style ecology, benefiting both household budgets and the environment. "said an adviser to the President on Monday. The government is also planning the next phase of electric leasing for 2025, envisaging an increase in the scale of the program. Further details will be communicated towards "the end of this year or early next year", confirmed Roland Lescure.
The sustainability of social leasing will be influenced in particular by automakers' ability to step up electricity production. " At present, demand is strong and French production of electric vehicles remains insufficient. This means that French automakers must either increase their production rate, or commit to doing so "said Roland Lescure on Sunday. "The advantage of this program is twofold: it makes electric vehicles accessible to people who are not necessarily wealthy, at an affordable cost, while promoting the production of French vehicles. Our aim is to succeed on both fronts," he added.
Stellantis claims that it is currently impossible to produce an entry-level vehicle in France, and recently launched its new Citroën e-C3, manufactured in Slovenia and priced at 20,000 euros. Renault also plans to launch its electric Renault 5 electricwhich will be produced in northern France, but at a higher starting price of 25,000 euros. Other manufacturers such as Volkswagen, Skoda, Nissan or Hyundai have also taken part in the "social leasing" program, although their offers were only launched in January. Volkswagen France said on Monday that it had received and accepted many applications, but regretted having joined the program after the French manufacturers.
