Will the consumer pay? The plan that will require manufacturers to recycle electric vehicle batteries
The Ministry of Environmental Protection is promoting a law that will require car manufacturers to recycle lithium batteries. The recycling will likely be funded through a levy on electric vehicles and could be passed on to consumer car prices. Simultaneously, the update of the green taxation and Euro 7 regulations is expected to bring an unusual wave of Chinese vehicle imports before the end of the year. Also: the new Audi Q7 and Dacia Duster models were launched in Israel.
The plan that will require manufacturers to recycle electric vehicle batteries | Exclusive
The Ministry of Environmental Protection is formulating a comprehensive reform that will legally require the recycling of lithium batteries for electric and electrified vehicles. According to estimates, the reform will be presented this year, will come into effect in 2027, and will be mandatory for car importers starting in 2029.
It should be noted that currently, the recycling of lithium batteries for vehicles worldwide is still technically complex, and its economic feasibility is questionable and varies depending on global raw material prices. Therefore, many governments subsidize this or place the responsibility for funding on car manufacturers.
According to the model being developed in Israel, the responsibility for recycling will be placed on car manufacturers, through the importers representing them in Israel, as part of an "extended producer responsibility" law.
In the automotive industry, it is estimated that the actual recycling will be carried out through the establishment of a government-designated "recycling corporation" for vehicle batteries, which will be responsible for collecting and recycling the batteries, and its funding will be provided by the manufacturers through the importers. One of the options being examined is the collection of a recycling levy on every vehicle with a battery sold in Israel. However, according to estimates, the additional cost will be passed on by the manufacturers to the prices of vehicles sold to importers in Israel, and from there it will reach the consumer car prices.
Significant amount of batteries
According to a study by the Knesset Research Center published in June this year, Israel is expected to face a significant problem by the end of the decade regarding the accumulation of lithium batteries that will reach the end of their life cycle and become polluting environmental waste. According to the study, at the end of 2025, there were about 316,000 electric and plug-in hybrid vehicles in Israel, which accounted for about 7% of the vehicle fleet, and in addition, about 487,000 hybrid vehicles with smaller batteries (about 11% of the vehicle fleet). It should be noted that in the first seven months of the year, a sharp jump was recorded, and nearly 80,000 "electrified" vehicles were added.
According to the report, in 2030, a need will develop to handle a significant amount of batteries that have reached the end of their effective life, assuming a battery life of about 8 years and relatively limited reuse of used batteries. However, the study notes that currently, there is no regulation on the subject in Israel, unlike many other countries, and there is a "historical cost," meaning hundreds of thousands of electric and electrified vehicles sold without collecting recycling fees.
It should be noted that in 2027, a reform will come into effect in Europe that requires manufacturers to track the life cycle of batteries, from production to scrapping. These data may be used as a basis for collecting a "battery levy" to fund recycling.
In response, the Ministry of Environmental Protection stated that it "is closely monitoring the significant growth in the volume of electric vehicles in Israel, as well as the parallel regulatory developments in the European Union in the field of handling vehicles in general and electric vehicle batteries in particular, at the end of their life.
"As part of the preparation for the expected growth in the volume of this waste, the ministry is conducting comprehensive staff work to examine the regulation of the end-of-life vehicle sector for all its waste streams, and is holding a dialogue with stakeholders... These days, regulation based on the 'extended producer responsibility' (EPR) principle is being examined, while examining the most appropriate legal and economic mechanisms for the Israeli market and existing and planned treatment infrastructures. Upon completion of the staff work and the initial formulation of the regulation proposal, the proposed mechanism will be published for public comment."
Due to green regulation: A massive and unusual wave of imports of new models and brands from China
In the last quarter of the year, an unusual wave of vehicle imports is expected, mainly from China, despite the fact that the Israeli market is already dealing with massive inventory surpluses of vehicles offered as "zero kilometer" at discounted prices.
Two main reasons are expected to contribute to this trend. The first is the significant update to the "green taxation" formula, which was published this week and will come into effect in January 2027. This formula determines the "green score" of all models imported to Israel, and according to it, the amount of the environmental purchase tax benefit for each model is determined.
According to initial calculations conducted this week in the industry, the updated formula is expected to significantly harm mainly hybrid models and gasoline models, and to a lesser extent plug-in models, and reduce the tax benefit on them by thousands of shekels. Therefore, early import of stocks before January may save relevant importers hundreds of millions of shekels.
The second reason is the new and strict "Euro 7" emission regulations, which will come into effect in Israel and Europe starting in November this year. This date sets a "deadline" for importing many new models to Israel, mainly Chinese models with hybrid and plug-in propulsion, which do not yet meet these regulations, and therefore will not be able to be sold here after the cutoff date.
Shortage of ships for vehicle transport
The trend in question is also expected to accelerate the entry into Israel in the next two months of new brands that have not yet been presented here. One of them is the ICAUR brand from Chery, which is currently exported to Europe with a single plug-in crossover with "Euro 6" certification, while the rest of the brand's models with "Euro 7" certification will appear only at the end of next year.
So far, it has not been announced who will be the importer in Israel, but according to estimates in the industry, the leading candidate is the Samalat group, which recently received the import franchise for the ICAUR brand in Switzerland and Romania. No response was received from Samalat.
Besides ICAUR, a series of new models and brands are expected to enter the Israeli market by the end of the year. It should be noted that the main limitation on the volume of imports is expected to be a shortage of ships for vehicle transport on lines from the Far East to Israel. Some importers are currently trying to solve the problem by accelerating the transport of vehicles to Israel on container ships.
New crossover models: Audi Q7 and Dacia Duster arrived in Israel
Champion Motors has begun marketing the new generation of the large Audi Q7 crossover. The vehicle has received a new design and is 5.06 m long, 1.81 m high, and has a wheelbase of about 3 m. The vehicle comes in a configuration with five or seven seats and with an advanced digital cabin, electric seats in the front and back, electronically controlled air suspension, electric doors, 21-inch rims, and more. Propulsion is provided by a 3-liter V6 turbo-diesel engine with electric assistance, which produces 324 hp and drives all wheels. The price starts at 690,000 shekels.
Carasso Motors has begun marketing in Israel an all-wheel-drive version with a hybrid propulsion system of the Dacia Duster crossover. The vehicle maintains the dimensions of the existing model with a length of 4.34 m, a height of 1.61 m, and a wheelbase of 2.66 m. It is equipped with a new hybrid propulsion system that combines a 1.2-liter turbo-gasoline engine and an electric motor with a combined output of about 170 hp. The vehicle comes in three trim levels. The base version has a 10.1-inch screen, a digital dashboard, and more. Prices range from about 158,000 to 171,000 shekels.
