The electric vehicle (EV) market in Europe is facing a challenging period, with new data revealing a slight decline in market share during the first half of this year. Despite the overall car market showing signs of recovery and heading towards pre-pandemic levels, the share of EVs has decreased by 0.3 per cent.
European EV Market Trends
According to findings from automotive analytics firm JATO Dynamics, the number of new car registrations in Europe grew by 4.4 per cent from 6.56 million units in the first half of 2023 to 6.85 million in the same period in 2024. However, while the total number of electric cars sold increased by two per cent to a total of 949,981 units, the market share of electric cars dipped to 13.9 per cent.
The UK market, in particular, has only seen a modest growth in EV market share, with an increase of 0.5 per cent to 16.7 per cent in the first half of this year. This suggests that despite the overall growth in the car market, the demand for electric vehicles in Europe is not keeping pace.
Chinese Electric Vehicles
Interestingly, JATO now reports that one in five new cars worldwide is a Chinese EV. This is a significant contrast to Europe, where Chinese EV models only account for 17 per cent of the number of electric cars sold and one per cent of all new registrations. However, this data excludes American brand Tesla, which has a gigafactory in Shanghai.
Felipe Munoz, Global Analyst at JATO, attributes the moderate growth in the European car market to a more complex operating environment, including emissions regulations, increasing vehicle prices, and barriers to the adoption of electric cars. He emphasizes the importance of dispelling uncertainty surrounding the EV market in the next six months.
EU Tariffs on Chinese EVs
One key factor contributing to the uncertainty in the EV market is the EU’s ongoing talks with China regarding new tariffs on imported electric cars. These tariffs, which came into effect earlier in July, impose additional duty charges of up to 38 per cent on all electric models imported from China to counteract what the EU perceives as unfair subsidization by Beijing.
The UK government has yet to announce its policy on this issue, but concerns have been raised about the potential impact on consumers. Peter Wells, a Professor of Business and Sustainability at Cardiff University, warns that post-Brexit, the UK is in a vulnerable position regarding these tariffs, and any additional costs would likely be passed on to consumers.
In conclusion, the European EV market is facing challenges, with a slight decline in market share despite overall growth in the car market. The rise of Chinese EVs globally presents a stark contrast to the European market, highlighting the need for industry stakeholders to address uncertainties and barriers to EV adoption. The impact of EU tariffs on imported Chinese electric cars remains a key issue to monitor in the coming months.