The Cypriot government is under fire over its decision to cut funding for electric vehicle (EV) subsidies, sparking concern among car importers and green mobility advocates. In a statement issued on Friday, the transport ministry confirmed that measures under Cyprus’ recovery and resilience plan (RRP) are progressing successfully, with revised goals to ensure continued EU payments.

These measures include subsidies for electric car purchases and incentives for retiring older, polluting vehicles.

The RRP initially set aside €30 million for electric vehicle subsidies and €15 million for alternative mobility schemes. In 2023, Cyprus secured an extra €8 million for EVs through the RePowerEU programme, boosting overall targets.

However, following a mid-2024 review, the government adjusted these targets to “realistic levels”. The new budgets stand at €32.8 million for EV grants and €9.8 million for low-emission mobility incentives.

This adjustment led to changes in the third round of EV subsidies, launched in February 2024 with a revised budget of €36.5 million, of which €26 million was earmarked for vehicle purchases.

The ministry stressed that these changes aim to maintain Cyprus’ eligibility for EU funding and align with the national energy and climate plan. It also pledged to seek further funding for new or extended grant schemes.

But the motor vehicle importers and electric vehicle association (Semio) reacted sharply, condemning the decision as sudden and damaging.

It accused the ministry of acting unilaterally, without consulting the industry, and warned the cuts would harm both consumers and importers.

Semio said members had already imported EVs based on the government’s original plan and committed to further orders that cannot be cancelled.

The association noted that these businesses also spent heavily to support the state’s subsidy efforts. It further warned that reducing the grants threatens Cyprus’ EU-mandated goal of registering 80,000 electric vehicles by 2030.

Importers were also left frustrated by the lack of prior warning. According to Semio, the number of available subsidies was drastically reduced when the government reopened its application platform on April 23. The platform had been closed since March 21, and the limited number of new grants was quickly exhausted.

Semio rejected claims from the ministry that public interest in EV grants was declining. It argued that demand remains strong and urged the government to engage in proper consultation before making further decisions.

The association has called for an urgent meeting with the transport minister to discuss the matter and prevent further disruption to Cyprus’s green transition efforts.