France has a fee and rebate system on new car sales. It was invented to make low emissions cars cheaper, with buyers receiving a government’s incentive, and gas guzzlers more expensive, because their buyers must pay an extra tax. The program is called bonus-malus, and it proved so effective to this day, that it ran a deficit. There were just too many French people buying small cars to get a rebate, and not enough of them to buy larger models and paying the extra fee. The government intends to correct this next year. It has just introduces a new schedule which dramatically reduces rebates, while fees are going way up.
The buyer of a small Smart Fortwo with a Stop & Start system will only get a €100 incentive in 2012 ($138), while the buyer of a Chevrolet Camaro V8 will have to pay a stout €3,600 fee ($4,962). The bonus for hybrids, €2,000 ($2,756), and electrics, €5,000 ($6,891), remains unchanged but what really sets France apart from the U.S. is the limit at which a car is considered a gas-guzzler. CO2 emissions are what matters, and a car gets to pay the top fee if its emissions are superior to 230 gram/km on the combined official fuel economy test. That is roughly equivalent to a 23.5 mpg combined fuel economy rating.
So any car that does 23 mpg or less comes with a $4,962 tax. A V6 Chevrolet Malibu is a gas-guzzler in France! No wonder nobody drives large pick-up trucks in France, and that most French drive small diesels…
All fee and rebate values are available here (in French).