Last year, Italian registrations of battery electric vehicles (BEVs) and plug-in hybrids (PHEVs) fell on-year by 16.4%, according to Italian automaker association Anfia.

“For 2023, we hope that the new government subsidies for the purchase of zero and low emission cars and electric light commercial vehicles, available since 2 January, will give a new boost to the electric market in Italy," Anfia director Gianmarco Giorda tells Kallanish.

Several factors contributed to the decline, Giorda explains.

“Given the fundamental importance of the government’s incentives to purchase, the decline seen in the first months of 2022 derives in part from the 'waiting effect' with respect to incentive measures. This has crippled the entire demand … The incentives to purchase of zero and low-emission cars only came into effect in the second half of May last year and the largest number of requests was for vehicles emitting between 61-135 grams per kilometre of CO2, for which resources were quickly exhausted. New subsidies and the extension of the 'eco-bonus' for lease companies - a sales channel capable of making an important contribution to the diffusion of electric cars - only became available in November, therefore a decline in electric vehicle sales was to be expected," Giorda comments.

Last year’s fall of BEV and PHEV registrations in Italy is also attributable to the current economic climate. High inflation and the reduced purchasing power of individuals have put a heavy toll on Italians’ appetite for these types of vehicles. The high price tag of electric cars, which remains elevated despite the government’s help, continues to be an issue that discourages potential buyers. Moreover, “the public and private recharging infrastructure is not developed and capillary enough in Italy to facilitate the spread of zero-emission vehicles in the country,” Giorda adds.

Anfia estimates that between €250-260 million ($270.37m-$281.19m) will be left over from the subsidy scheme this year. The director believes the funds should be used in 2023 to incentivise sales of vehicles consuming between 0-20 and 61-135 g/km of C02.

Earlier this year the Italian Ministry of Economic Development (Mise) allocated €630 million to subsidise the purchase of green cars, light commercial vehicles, and motorcycles. About €190m will support sales of vehicles emitting between 0-20 g/km of CO2, €235m are for vehicles that produce 21-60 g/km of CO2, and €150m will boost sales of vehicles in the 61-135 g/km of CO2 range.

Despite last year’s government help, data from Anfia reveals that in 2022 BEV sales fell by 26.9% while PHEVs registrations declined by 6.2%. A total of 113,801 new BEVs and PHEVs entered Italian roads, taking a market share of 8.6% last year. This is down from 136,168 zero-emissions vehicles registered in 2021.

December also represented another drop in sales of these types of vehicles. Registrations decreased by as much as 26.6% for BEVs and 9.1% for PHEVs. Combined these powertrains held a market share of 9.2% last month (see Kallanish 17 January).