Germany considers $5,500 incentive for electric cars

FRANKFURT/BERLIN, Jan 29 (Reuters) - German politicians and auto executives will discuss creating incentives worth up to 5,000 euros ($5,500) to boost sales of electric and hybrid cars, a senior ally of Chancellor Angela Merkel said on Friday.

Germany has set itself a goal of bringing 1 million electric cars onto its roads by 2020, but has so far made little progress in encouraging drivers to switch from more polluting - but also generally cheaper - diesel and petrol vehicles.

The heads of the three parties in Merkel’s ruling coalition have discussed introducing a subsidy for electric car buyers, said Horst Seehofer, head of the Christian Social Union (CSU), sister party of Merkel’s Christian Democratic Union (CDU).

He added the government was looking into whether car companies could co-finance the new incentive and that Merkel would discuss the issue with company executives next week.

Asked whether he was backing proposals to introduce an incentive of up to 5,000 euros, Seehofer said: “Bavaria is very much in favour of the buyer’s premium.”

Seehofer is state premier of Bavaria, the southern German state where carmaker BMW is based.

A spokeswoman for Germany’s Economy ministry said: “Talks within the German government are constructive. We are counting on arriving at a good solution to help achieve our goals.”

In 2015, 23,500 electric and plug-in vehicles were registered in Germany. Of these, only 12,300 were pure electric cars, according to Stefan Bratzel at the Center of Automotive Management in Bergisch Gladbach.

$1 = 0.9161 euros Reporting by Edward Taylor, Caroline Copley and Andreas Rinke; Writing Michael Nienaber; Editing by Mark Potter