EVs have potential to reach 24 per cent EU car market share by 2025

Transport & Environment (T&E), a prominent campaign group, has released new projections for the market share of battery-electric vehicles (BEVs) in the European Union. According to their analysis, BEVs are expected to capture between 20 per cent and 24 per cent of the total market by 2025. This forecast is primarily attributed to the anticipated reduction in selling prices for electric vehicles.

The current landscape of EV sales in the EU has shown a slowdown in recent months. In the first half of the year, EVs accounted for only 14 per cent of the market share. This deceleration can be partially attributed to the inconsistent policies regarding green incentives across different EU member states. EU regulators have imposed substantial tariffs on Chinese cars in an effort to protect the European automotive industry.

Germany, which represents the largest EV market within the European Union, took action in September by introducing new incentives aimed at accelerating the transition to green transportation. This move is expected to have a significant impact on the overall EV adoption rate in the region.

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T&E has revised its earlier forecast from June, which had predicted a 21 per cent market share for EVs next year. The organisation now anticipates a resurgence in sales, based on several factors. One key consideration in their updated projections is the expected introduction of seven new fully-electric models priced under 25,000 euros (USD 27,835.00) in 2024 and 2025. These affordable models are predicted to capture 10 per cent to 15 per cent of the BEV market next year, making electric vehicles more accessible to a broader range of consumers.

In terms of environmental impact, T&E estimates that BEVs will play a crucial role in helping carmakers meet EU emissions targets next year. The organisation projects that BEVs will contribute approximately 60 per cent of the required carbon dioxide (CO2) reduction. Hybrid vehicles are expected to account for an additional 20 per cent of emission reductions, further supporting the industry's efforts to comply with regulatory standards.

However, the European automotive industry is facing challenges on multiple fronts. A decline in EV demand, coupled with increased competition from more affordable Chinese competitors, has led some European manufacturers to call for legislative action.

Specifically, they are urging EU lawmakers to activate a crisis clause that would postpone their CO2 targets by two years, providing them with more time to adapt to the changing market conditions.

The shifting landscape has already prompted several major automakers to reassess their electrification strategies. Companies such as Stellantis, Toyota, Renault, and Mercedes-Benz have all announced adjustments to their electrification targets, scaling back their initial ambitions in response to market realities and challenges.

T&E strongly opposes any attempts to weaken or delay the 2025-2030 emission targets. The organization emphasises the importance of maintaining robust national policies to support the electrification of the automotive sector. They argue that protecting underperforming automakers will only serve to diminish their competitiveness in the long run. T&E asserts that the current dominance of Chinese EV manufacturers in the market demonstrates the risks of shielding less progressive European automakers from competition.