Cargo bikes: Would you rather spend money on air taxis instead of bicycle infrastructure?

Highlights: Federal funding has been canceled and previously approved funds are flowing slowly. Further two-wheeler funding projects will be reduced or abolished. The city council and industry see the transport transition in danger. Individual models from the Dutch manufacturer Babboe are considered dangerous due to possible frame breakages, and their sale has also been discontinued in Germany for the time being. The expiry of the funding program for cargo bikes is a “fatal signal,” says the Two-Wheeler Industry Association.

Cargo bikes relieve cities of car traffic. Federal funding has been canceled and previously approved funds are flowing slowly. Further two-wheeler funding projects will be reduced or abolished. The city council and industry see the transport transition in danger.

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Cargo bikes:

So-called cargo bikes are popular, but funding for climate-friendly replacements for cars in the city is drying up

Photo:

Michael Gstettenbauer / imago images

Many people see cargo bikes as an alternative to cars. Families appreciate them, delivery services and companies also use them. According to the Zweirad Industrie Verband (ZIV), dealers sold 235,250 of these cargo bikes last year - even if the boom leveled off, there was still an increase of 10.5 percent, while bicycle sales fell by 14 percent overall. A hoped-for side effect: cargo bikes can relieve the roads in Germany's cities from climate-damaging car traffic.

But at the moment the waves surrounding the vehicle are rising. Individual models from the Dutch manufacturer Babboe are considered dangerous due to possible frame breakages, and their sale has also been discontinued in Germany for the time being. In addition, insurers' accident research unsettles customers and considers cargo bikes "as a rule not sufficiently suitable for transporting children."

What could further dampen demand in the future: Funding for cargo bikes is barely flowing, if at all. The cargo bike boom could soon come to a standstill due to a lack of funding and amid the safety discussion and slow down the transport transition.

Air taxis more important than cargo bikes?

Only a few federal states and municipalities still support the purchase of climate-friendly cargo bikes for private and commercial use (

see here

). The federal government's purchase bonus for commercially used cargo bikes expired on March 1st. It is also a question of money whether people's mobility behavior changes. This is already demonstrated by the initially restricted and then abruptly ended purchase bonus for electric cars, as a result of which sales of electric vehicles plummeted significantly.

An extension of the funding program for commercially used cargo bikes by the federal government is being considered, according to faction circles in Berlin. But that is by no means certain. Finally, FDP Federal Finance Minister

Christian Lindner

(45) is currently ringing in the next round of savings for the 2025 budget. This will not stop

his party colleague and Transport Minister

Volker Wissing

(53) from potentially disbursing 150 million euros in air taxi funding soon.

Every second car freight transport will be by bike in the future?

It is unlikely that up to 2,500 euros in funding will continue to flow per cargo bike in the future. The organization Zukunft Fahrrad notes that the potential of cargo bikes for the transport transition and climate protection in cities is considerable. The interest group emphasizes that cargo bikes could replace half of the freight transport carried out by cars in the city.

For

Helmut Dedy

(65), head of the German Association of Cities, cargo bikes are not only “a real alternative to cars that have been successfully tested by parcel services and craft businesses”, but also an important building block on the way to a climate-neutral transport transition, he explains to manager magazin.

The expiry of the funding program for cargo bikes is a “fatal signal,” says the Two-Wheeler Industry Association (ZIV). There is still “great potential,” especially for commercial vehicle fleets, to convert them to a sustainable form of mobility with cargo bikes. “This doesn’t just apply to delivery services. Nursing services, craftsmen and chimney sweeps can also benefit from this," says ZIV spokesman

Pablo Ziller

to manager magazin.

Potential for commercial businesses

The Bicycle Logistics Association of Germany (RLVD) estimates that there are well over 100,000 purely commercial cargo bikes on the road in Germany. “Promotion is essential for competitive prices and the market ramp-up,” says

Jonas Kremer

, political spokesman for the RLVD and also head of business customers at Isicargo, one of the leading dealers for commercial cargo bikes. The funding stop is putting a strain on young, specialized manufacturers as well as suppliers of bicycles. Logistics services: “There is a risk of many bankruptcies,” warns Kremer to manager magazin.

The bicycle industry and interest groups find it particularly annoying that many customers who submitted an application for funding before the Federal Constitutional Court's ruling and before the funding program expired on March 1, 2024, are waiting for notices and the purchase bonus. “The delayed release of funds from the Climate and Transformation Fund by the Federal Ministry of Finance acts like a cold stop to funding. Companies that have applied for the purchase bonus now have to wait indefinitely until they can switch to the cargo bike,” says Arne Behrensen from Zukunft Fahrrad. This is damaging to all companies involved and to the turnaround in commercial transport.

Payouts from KTF funds are delayed

In fact, in mid-March it became clear that KTF funds were only partially allocated - including to the Federal Ministry for Economic Affairs and Climate Protection, which relies on a particularly large amount of resources from the fund. The Federal Ministry of Finance explains: In view of the tense budget situation and because of the far-reaching ruling of the Constitutional Court on budget management, the handling of KTF funds differs from previous years. Since there are no longer any significant reserves, the Federal Finance Minister is exercising caution when distributing the funds in order to be able to react quickly to possible changes.

Bafa admits delays

"Lindner is sitting on the money, it's only coming in bits and pieces," says one ministry. For example, in many cases the payment for approved subsidies for energy consulting is delayed, Bafa confirms to manager magazin. The Federal Office for Economic Affairs and Export Control (BAFA) also examines and decides on funding applications and the payment of the cargo bike purchase bonus in a two-stage process. There were delays between November and the end of February. "In more than 900 cases, the applications were examined but could not be approved because no funding was available," explains the Federal Office upon request.

At the end of March, Bafa approved these 900 applications and issued so-called grant notices totaling around 1.8 million euros. This means that the purchase premium is

“reserved”

. However, it will only be paid out once Bafa has checked the “appropriate use” and the submitted invoice in a second step. This can take a while. “Incoming proof of use is processed promptly. There were and are sufficient funds available to pay out the subsidies,” assures a Bafa spokesman.

Other transport transition projects were also cut

The bottom line is that from the start of the program on March 1, 2021 until its end, Bafa has actually paid out funding of 11.14 million euros for around 7,900 e-cargo bikes (as of March 22). However, it remains unclear whether and to what extent the cargo bike purchase bonus will still be granted in the future. For City Council General Manager Dedy and “Future Bicycle”, the funding stop is just one of several examples where programs for the transport transition were not extended or shortened.

For example, funding for the

purchase of electric buses
has been significantly reduced this year. In the following years it will be eliminated completely.
Federal Transport Minister Wissing promoted the “

Bicycle parking garages at train stations
” project with much fanfare in 2023 - there will no longer be any KTF funds for this in the future, but projects that have been started may be completed.
The allocations to the federal states for the

construction of cycle highways
for commuters have been cut by more than half for the current year. In 2025 they should be eliminated completely.
Around 55 million euros less will go to the states for investments in cycling as part of the special “

City and Country
” program.

Funding for cycling has more than halved since 2022

Overall, the Federal Ministry of Transport has reduced funding for cycling by 200 million to 350 million euros, calculates “Zukunft Fahrrad”. In 2022, Wissing made 750 million euros available for cycling. According to the transport minister's current budget plans, this trend will continue, criticizes the lobby association.

For City Council boss Dedy, this is the wrong signal. “The transport transition is an essential component in ensuring that our cities remain livable.” But the framework conditions for good services and alternatives to car traffic are deteriorating noticeably, says Dedy to manger magazin. “The stopping of many funding programs for the transport transition is making investments increasingly difficult.”