New Car Sales in the EU Decline

By Greta Rosen Fondahn and Alessandro Parodi

New car sales in the European Union fell by 18.3% in August, reaching their lowest level in three years. Major markets like Germany, France, and Italy faced double-digit losses, alongside a decline in electric vehicle (EV) sales, according to the latest data from the auto industry body.

This marks the fourth consecutive monthly drop in EV sales. The European Automobile Manufacturers’ Association (ACEA) has urged for urgent action to prevent further declines, emphasizing the need for relief measures before new CO2 targets for cars and vans take effect in 2025.

Sales of fully electric cars decreased by 43.9% in August, with Germany and France reporting significant drops of 68.8% and 33.1%, respectively. Additionally, registrations of plug-in electric cars also fell by 22.3% across the bloc.

Sales of Europe’s top three carmakers, Volkswagen, Stellantis, and Renault, saw reductions of 14.8%, 29.5%, and 13.9% year-on-year. Overall, car sales in Europe remain below pre-COVID-19 levels, and Volkswagen has indicated that this trend may persist.

EV maker Tesla experienced a 43.2% drop in sales for August, while China’s SAIC Motor saw a decline of 27.5%. The contraction in EV sales is attributed partly to differing policies on green incentives throughout the EU, as well as significant tariffs imposed on low-cost Chinese EVs, which could elevate purchase prices.

In an effort to revitalize the market, Germany introduced tax deductions of up to 40% for companies selling EVs in September.

Despite current challenges, the campaign group Transport & Environment predicts recovery for the market, with battery electric cars expected to achieve a market share of 20% to 24% by 2025, primarily due to lower selling prices.

Hybrid electric cars (HEV) have gained popularity recently, boasting a 6.6% increase in sales for August, achieving a 31.3% market share, according to ACEA data.