Starting October 1st, the French government will offer an additional 1,000-euro bonus for electric vehicles equipped with European-made batteries, aiming to promote domestic EV adoption and bolster the European automotive industry.

This initiative seeks to encourage automakers to source batteries from European factories, supporting local manufacturing and relocalizing the EV value chain to protect industrial jobs across Europe.

The policy is part of a broader effort to ensure public aid benefits domestic employment, with the list of eligible vehicles—assembled in Europe and using European batteries—set to be published soon and updated monthly by the Agency for Ecological Transition (Ademe).

A notable example of European battery development is AAC, a collaboration involving Stellantis, TotalEnergies Saft, and Mercedes, which produces batteries at a gigafactory in Billy-Berclau for models like Peugeot e-3008, e-5008, and Opel Grandland.

However, many European battery factories, such as ACC in Billy-Berclau, are behind schedule, and most European EVs still rely on Asian batteries, with recent setbacks like Northvolt casting doubt on Europe's battery ambitions.

This move comes amid stiff competition from Chinese manufacturers like BYD and declining support for EV incentives in France, prompting a key Brussels meeting to discuss the future of the European automotive sector.

The initiative aligns with recommendations from the Draghi report, advocating for explicit 'Made in Europe' criteria to support jobs and industry, especially as European automakers face international competition.

The increased bonus will be funded through the energy savings certificates (CEE) system, meaning it will not impact the state budget.

While many EV batteries are assembled in Europe, a significant issue remains regarding the definition of a 'European battery,' as many contain imported cells from Asia or South Korea.

French automakers like Renault are expected to benefit, with plans for the Renault 5 to be equipped with batteries from the Douai plant, moving toward 100% French-made batteries by mid-2026.

This new bonus complements existing incentives, increasing the maximum aid from 4,200 to 5,200 euros for low-income households and from 3,100 to 4,100 euros for others, depending on income and vehicle environmental scores.