Economy 29 November 2024, 12:23pm

Interest for state-subsidised electric vehicle tender blows up in Hungary

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A total of 270 companies in Hungary have applied in November for state subsidies paid for electric car purchases, up considerably from 173 in October. The jump is related to the end-October relaxation of the tender conditions, the Energy Ministry said in a statement on Friday.

There has also been a significant increase in the number of electric vehicles applied for: 285 in November, versus less than 200 in October. The total amount of subsidies applied for exceeded HUF 1.1 billion in November.

The sudden upturn is linked to the Ministry's announcement at the end of October to relax the tender conditions.

Under the changes, businesses established in 2022 can also apply for support (previously only those set up before 31 Dec 2021 were eligible), without any revenue constraints, and even if they have withdrawn their previous application for some reason.

So far, around 4,200 companies have applied for funding under the government programme to purchase a total of 5,005 pure electric cars, vans or minibuses, which

accounts for almost two thirds of the total HUF 30 billion budget.

On the basis of the applications already evaluated, more than 3,400 companies can expect to receive a total of around HUF 16 billion, of which nearly HUF 3.9 billion has already been paid out to 1,000 winners.

The largest proportion of companies would like to green their fleets with passenger cars, accounting for three quarters of all applications.

Since the beginning of February, businesses can apply for a non-refundable grant for the purchase of an electric car, truck or van. Depending on the battery capacity, the cost of buying an electric vehicle can be up to HUF 2.8-4.0 million. Businesses with fewer than ten employees can purchase no more than one vehicle, businesses with between 10 and 49 employees up to five, businesses with between 50 and 249 employees up to ten, and larger businesses up to 16 vehicles by spring 2025.

Based on the decisions taken so far, more than 3,400 companies can expect to receive a total of around HUF 16 billion. A total of almost HUF 3.9 billion has been paid out to nearly a thousand winners.

The ministry pointed out that the government is promoting electromobility with a total of nearly HUF 60 billion in two programmes. In November, a HUF 28 billion call for proposals was launched to tackle the white spots in the rural charging network. The tender will allow the creation of more than 100 new charging stations in the coming years.

The number of green licence plates issued in Hungary dropped 6.1% month on month and 11% year on year in October, according to the latest data by the Ministry of the Interior. The number of pure-electric passenger cars newly registered with green licence plates showed a 7.5% month-on-month decline, but a nearly 36% year-on-year increase. With green licence plate registration rules tightened on 1 September, the share of hybrid electric and plug-in hybrid electric vehicles in all new registrations dropped practically to zero, but the cumulated figures do not reflect the change.

The European car market has grown again, although only moderately in October. This means that in the first ten months of 2024 there were slightly more new passenger cars registered than in the same period last year. The Hungarian market expanded significantly last month, which is encouraging as new registrations, which had been in decline in the spring, seem to have started to recover in the autumn.