A red light for social leasing, a victim of its success

OI really don’t know whether to see this as good news or bad news. The 2024 edition of “Social Leasing” for electric cars is coming to an end this Tuesday, February 13, six weeks after the initial buzz of operations. A victim of his own success. 50,000 orders were placed, while the initially planned volume did not exceed 25,000 vehicles. It will resume in 2025, in a form yet to be defined.

Detailed by Emmanuel Macron in mid-December, a year and a half after a promise he made during the presidential campaign…

OI really don’t know whether to see this as good news or bad news. The 2024 edition of “Social Leasing” for electric cars is coming to an end this Tuesday, February 13, six weeks after the initial buzz of operations. A victim of his own success. 50,000 orders were placed, while the initially planned volume did not exceed 25,000 vehicles. It will resume in 2025, in a form yet to be defined.

Detailed by Emmanuel Macron in mid-December, the system was opened on 1, a year and a half after the promise he made during the presidential campaign.^er

From January low-income households, whose reference tax income is less than 15,400 euros per unit. Its target, “heavy riders”, who cover at least 8,000 kilometers per year for professional reasons. Or those who live more than 15 kilometers from their place of work and use their vehicle to go there. Social Leasing allows them to subscribe for a minimum three-year lease, with the option to buy for as little as 100 euros per month for an electric city car or up to 150 euros per month for a family sedan. It is public finance that covers initial costs, up to 13,000 euros per vehicle.

Towards a possible “yellow vest”.

“Social leasing is aimed at the social category with limited financial resources. Their travel is restricted, they are not ‘leisure cars’. These are the potential ‘yellow vests’ who are targeted as such, their older vehicles are too expensive for them and not up to the level of the most modern models. So we can understand the success of the operation. Especially since the promotion of electric cars continues. From the French government and Europe who have announced the end of new thermal cars in 2035. And manufacturers who are increasing their advertising,” analyzes the Bordeaux engineer Laurent Castagned, expert on the environmental effects of transport and author of the work “Run to the electric car, between miracles and tragedies”, published last year (ed. Ecosociété).

Even the lightning success of social leasing shows its limits. 50,000 eligible files are not insignificant when we consider that in 2023 only 330,000 electric vehicles were registered in France. But the goal of the “decarbonization” of transportation — transitioning a fleet of thermal cars to an electric fleet — remains a long way off. Electrics captured 16.5% of the market in the new passenger car segment last year, which doesn’t really sound like a referendum. About one million electric models are in circulation in France, out of about 39 million cars. A large drop of water. How can we increase it further without increasing the bill paid by the taxpayer, knowing that only about half of the households meet the social criteria for state-supervised tenancies?

Distance and travel time

Basically, the fate of the device says everything about the mismatch between the cost of a new electric vehicle and the resources of the average household. “The windfall effect is clear,” said Laurent Castagned of the judges. Restricted to cars under 47,000 euros manufactured in Europe, it covers entry and mid-ranges that are hard to find because the number of eligible models is so small. Among small cars, we can cite Renault Twingo E-Tech and Fiat 500e. For a family car, Peugeot E-2008 or Jeep Avenger. American Tesla’s top of the range, like Chinese BYD’s more affordable models, is excluded from social leasing.

According to the Bordeaux expert, the question of costs borne by the consumer-driver is central to a successful transition to electric vehicles but does not sum up the challenges of mobility for the present and the future. “For people who live, for example, about thirty kilometers from Bordeaux, due to a lack of affordable land, switching to electric will not reduce the distance or transport time. Electric cars won’t go any faster! For over forty years, we have offered fast and cheap vehicles with the promise of saving time and money. This promise is not being realized as the home/work distance is increasing. In the short term, social leasing will certainly have a positive effect. I am more skeptical about its long-term effects,” said Laurent Castagned.