Farebox recovery ratios in Germany before Covid were around 75 %, so abolishing all fares would mean quadrupling the budget for operating subsidies [1]. While I am not opposed to some moderate fare reductions, you could pay for quite a large bit of service improvements with that amount of money instead, and I believe that would be rather more effective in increasing passenger numbers (and especially in getting car drivers to switch).

[1] Some of the big cities are actually even closer to break-even as far as day-to-day operating costs are concerned, so in those cases the budget would have to be increased by an even larger factor in percentage terms.