Incentives 2022, what can be improved?

Incentives 2022, what can be improved?

Incentives 2022

The text of the ministerial decree relating to car incentives for the year 2022 has finally been approved, and as always, the definition of a text of law generates controversy on the part of those who find deficiencies or contradictions in the approved texts, and this situation could not certainly make an exception: let's analyze together what are the reasons why the new decree is considered a bit fallacious and certainly can be improved.

The text of the decree first of all demonstrates that it does not take into account the production difficulties that the sector is going through: in the decree the maximum period that can elapse between the booking of the bonus and the actual registration of the vehicle is indicated in 180 days, a time that is decidedly too short in this period where the production of cars is often slowed down by scarce procurement of materials - we saw this only a few days ago in reference to the Ford Fiesta, whose production is proceeding to re slow due to the war in Ukraine.

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If the aim of these incentives was to favor the ecological transition through the renewal of the circulating car fleet, the objective certainly cannot be said to be centered: the Dpcm in fact excludes from the incentives all forms of short and long-term rental, thus cutting out about a third of the market - the one that it is normally covered by long-term company car rentals, which not only drive the market with cars of a certain caliber, but also greatly fuel the second-hand market given the high rate of renewal of company fleets.

Speaking of the decree that has just been approved, the Minister of Economic Development Giancarlo Giorgetti declared:

“Incentives are not decisive, but they are an emergency tool to attract pay a difficult time. The pandemic, the shortage of raw materials and the war are also putting a strain on this sector. It is necessary to open a reflection on the necessary ecological transition which must be sustainable, possible and not leave behind dead and wounded ".

Although the text of the Dpcm seems incomplete or not very concrete on some issues, unlike the previous decrees, this time we worked in a three-year perspective, to give continuous support to a sector that is going through a very difficult period .

Italy approves new car incentives of 650 mln euros per year

Drivers queue up outside a gas station to fill up their cars as gasoline prices keep rising in Catania, Italy, March 11, 2022. REUTERS/Antonio Parrinello

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  • Purchase of EV cars subsidised up to 5,000 euros
  • Contribution for hybrid cars up to 4,000 euros
  • Subsidy of 2,000 euros for Euro 6 combustion cars
  • ROME, April 7 (Reuters) - Italian Prime Minister Mario Draghi has signed a decree to allocate 650 million euros ($709 million) per year from 2022 through 2024 for incentives to buy electrified or low-polluting cars, the country's industry ministry said on Wednesday.

    The outlay is part of a wider 8.7 billion euro long term plan that Italy announced earlier this year to support its carmaking industry. This allocates 700 million euros in 2022 and 1 billion euros per year from 2023 until 2030. read more

    The wait for incentives, which Rome had announced earlier this year, weighed on car sales in the first months of 2022, with analysts and lobby groups saying buyers were postponing purchases while waiting for the government to implement them.

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    New car registrations in Italy fell around 23% in February and 30% in March from the year earlier periods.

    Rome will subsidise up to 5,000 euros of the purchase price of new electric vehicles costing up to 35,000 euros excluding VAT.

    That includes a 2,000 euro contribution linked to the scrappage of a polluting combustion-engine car, the decree showed.

    The purchase of plug-in hybrid electric vehicles costing up to 45,000 euros will be subsidised by up to 4,000 euros, while the plan also includes an incentive of 2,000 euros for state-of-the art combustion-engine (Euro6) cars costing up to 35,000 euros when older vehicles are scrapped.

    Funds are also available for incentives to buy new motorcycles and for small- and medium-sized business to buy fully electric vans, according to the decree.

    ($1 = 0.9169 euros)

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    Reporting by Giuseppe Fonte; Writing by Giulio Piovaccari; Editing by Kirsten Donovan

    Our Standards: The Thomson Reuters Trust Principles.

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