Germany's Coalition to Boost EV Demand and Convert Plants

BERLIN (Reuters) - Germany's new government pledged support for its car industry while also vouching for converting available plants for defence, a document on the coalition agreement reached by the country's conservatives and Social Democrats and seen by Reuters showed.

The parties planned to provide purchase incentives for electric cars, including plug-in hybrids and cars fitted with range extenders to boost an EV's battery, and promised tax discounts for company cars including an exemption from vehicle tax for electric cars to last until 2035.

The new government will also examine whether it can support converting and upgrading surplus car plants for use by the defence industry, as defence companies seek more capacity amid a Europe-wide push to ramp up production of military equipment in the face of waning support from the United States.

"The defence industry needs to grow very quickly and in a scalable manner," the document said.

The government will also make an "active effort" to ward off emissions fines, the document said. The EU - with German backing - previously loosened emissions targets when carmakers said the looming fines would take money away from their transition to electrification.

It will also provide support for filling stations for new hydrogen-powered commercial vehicles, it said, without providing details.

(Reporting by Victoria Waldersee; Editing by Ludwig Burger)