Europe car sales gain most in 15 months as consumers warm to EVs
Some countries are trying to jump-start electric vehicle demand by bringing back or extending subsidies
[STOCKHOLM] Europe’s new-car market rose the most in 15 months in July, as consumers shrugged off concerns over the global economy to splash out on fully electric and hybrid models.
Registrations climbed 5.9 per cent last month from a year earlier – the steepest gain since April 2024 – to 1.09 million units, the European Automobile Manufacturers’ Association said on Thursday (Aug 28).
Plug-in hybrids made the biggest jump in July of 52 per cent, as buyers increasingly opt for models that combine electric driving with a backup combustion engine. Sales of fully electric vehicles (EVs) rose by more than a third, the best result since January.
The data is a boost for the region’s beleaguered industry following a sharp drop in June. European automakers continue to face headwinds as US President Donald Trump’s tariffs disrupt supply chains and Chinese brands led by BYD gain ground with affordable EVs.
In Europe, the electric transition remains uneven, with the next big test coming at the IAA Mobility show in Munich next month, where BMW, Volkswagen and Mercedes-Benz Group will seek to boost their EV credentials.
It comes as the European Union continues to push to get the US to lower tariffs on imports. The bloc will seek to fast-track legislation to remove all tariffs on US industrial goods, Bloomberg News reported this week. That’s a key demand from Trump, who has tied the step to a promised reduction in duties on EU cars from the current 27.5 per cent level.
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European brands are increasingly pushing towards EVs, but they have also warned that the EU’s ban on combustion engines is not realistic and is weakening an already fragile industry. The European Commission has somewhat eased the pressure on carmakers by granting them a three-year window to hit stricter carbon dioxide emissions targets that had been due to take effect this year.
While demand for EVs and plug-in hybrids was strong, hybrid-electric models – those without a plug-in charger – continued to capture the largest slice of the European market, accounting for more than a third of new registrations. Robust demand in Germany and Spain lifted the overall numbers, even as declines in France and the UK weighed on the total.
Some countries are trying to jump-start EV demand by bringing back or extending subsidies. This includes the UK, which has reintroduced grants of as much as £3,750 (S$6,510) to support EV purchases, three years after the previous government ended subsidies for private buyers. Consumers in the country held off on buying EVs last month as they waited to find out which models would qualify for the incentive.
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As for the manufacturers, Tesla continued to suffer. Sales of the Elon Musk-led brand slumped 40 per cent last month, giving it a market share of just 0.8 per cent. Volkswagen, Ford Motor and BMW had double-digit gains, while BYD’s deliveries more than tripled. BLOOMBERG
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