Sweden Plans New Targeted Subsidies as Initial Electric Vehicle Scrapping Program Underperforms

Sweden's initial 500 million SEK electric vehicle (EV) scrapping subsidy program, launched to encourage replacing old fossil-fueled cars, has fallen significantly short of expectations. According to Boverket figures, fewer than 4,000 individuals benefited from the scheme designed to support 50,000 recipients. Initially set at 10,000 SEK from August 2024, the subsidy was increased to 25,000 SEK in May 2025, spurring a tenfold rise in applications just before it ended on October 31, 2025. However, CEO of Mobility Sweden, Mattias Bergman, criticized the initial subsidy as too low and expressed concern over the timing of the increase and abrupt program termination at peak interest.

The program's impact was uneven, heavily favoring urban residents, with half the funds allocated to Stockholm, Skåne, and Västra Götaland. To address these shortcomings, a new subsidy program is being proposed, targeting low-income households in rural municipalities where car ownership is essential and public transport limited. This initiative could offer up to 46,800 SEK over three years to eligible families. The EU Commission is currently reviewing the proposal, aiming for implementation early in 2026.

Bergman highlighted that while EVs were initially costly, the market now offers more affordable options that could attract lower- and middle-income buyers. Complementing the subsidy plans, the Swedish government also intends to expand support for EV charging infrastructure, particularly in apartment buildings, to facilitate EV adoption further.