Europe surpassed China in 2020 to become the world’s largest market for electric vehicles, amid a pedal-to-metal force to boost the adoption of electric vehicles by governments and supercharged consumer demand.
New electric vehicle registrations exceeded 1.33 million in key European markets last year, compared to 1.25 million in China, according to a report based on public data by the car analyst Matthias Schmidt.
The 18 markets include the states of the European Union – minus 13 countries in Central and Eastern Europe – as well as the United Kingdom, Norway, Iceland and Switzerland.
And growth will only continue, according to Schmidt, who publishes the European Report on Electric Cars. He expects the share of electric vehicles in the European car market to increase from 12.4% in 2020 to 15.5% in 2021 – ie 1.91 million vehicles out of a total of 12.3 million and an increase of 572,000 from 2020.
Key trends emerged as European racing became the most important region for electric vehicles, as highlighted in Schmidt’s report to MarketWatch.
These include the fact that Renault Zoe is now the most popular electric vehicle in Europe, surpassing the Tesla 3 model, which took first place in 2019. In fact, Tesla’s success in Europe has declined in recent years, with the US. company that delivers 97,791 cars across the continent in 2020, down from 109,467 in 2019.
Here’s what you should know:
SUVs are driving growth
When you think of green vehicles, sports cars and crossovers probably don’t come to mind. But this class is by far the most popular type of battery-powered electric vehicle in Europe, accounting for 27% of all registrations in 2020 and 29% in December alone.
Hyundai 005380,
and Kia 000270,
led the package, accounting for 39% of the volume of electric SUVs and batteries in 2020.
SUVs and crossovers are even more popular with hybrid buyers – accounting for 53% of plug-in hybrid electric vehicle volumes last year.
Luxury buyers prefer hybrids
When it comes to hybrids, the better the better. Premium brands accounted for 58% of all plug-in hybrid electric vehicles in 2020.
Many of these cars were supplied by the German car giants: Volkswagen Group VOW,
owning Audi and Porsche, Daimler DAI, owner of Mercedes-Benz,
and BMW BMW,
A wave from China follows
As Chinese carmakers step up their efforts to meet market demand at home and abroad, they are looking to Europe.
The volume of electric vehicles in Europe manufactured by Chinese companies increased by 1290% from 2019 to 2020, to 23,800 units. Much of this momentum came only recently – half of these cars arrived in the last three months of the year.
While Europeans rushed to buy electric vehicles, the flow of cars from China also included Teslas. In December, 20% of the total Tesla TSLA,
the models registered in Austria were made in China.
Read also: Audi bets on luxury market in new electric vehicle business with China’s oldest carmaker
Government action is accelerating the adoption of EVs
European carmakers are being pushed to produce more electric vehicles by threatening fines of hundreds of millions of euros from the European Union on mandatory emission targets.
Phased until 2020 and continuing until 2021, the average fleet-level emissions target for new cars should be 95 grams of carbon dioxide per kilometer, which means about 4.1 liters of petrol per 100 kilometers.
Following the post-Brexit trade deal, the British government said carmakers in the country were facing emissions targets “at least as ambitious” as in the EU.
The adoption of electric vehicles is being pushed by both sides of the market, with governments boosting demand by providing generous incentives for buyers to trade with their gas consumers.
In Germany, buyers can save up to EUR 9,000 ($ 10,940) on the purchase of new electric vehicles. France has offered incentives of up to 7,000 euros in 2020, but will reduce this to 6,000 euros in 2021.
Regulation could affect some short-term baselines
The Volkswagen Group confirmed last week that it has not met the EU’s 2020 emissions targets, which means the company is on the verge of fines of more than 100m euros.
Others may face the same fate, although rivals Daimler, BMW, Renault RNO,
and Peugeot (now part of Stellantis STLA,
) everyone says they have achieved their goals.
“Despite the very ambitious efforts of electrification, it was not possible to fully achieve the set objective of the fleet. But, clearly, Volkswagen is on the right track, “said Rebecca Harms, a member of Volkswagen’s Independent Council for Sustainability.
“The key to success will be giving a bigger role to smaller, efficient and affordable models in implementing electrification.”
It is unclear how easy this will be in 2021. The COVID-19 pandemic has contributed to the fewest car registrations in Europe since 1985, and according to Schmidt, this has allowed a number of carmakers to meet their targets. emissions.
Read also: Car manufacturers have pedaled the metal of electric vehicles in 2020, with sales rising in a key region where Tesla has lost market share
Tesla loses its dominance
Tesla comfortably topped the European EV charts in 2019. It delivered over 109,000 vehicles that year, accounting for 31% of the region’s battery-powered electric vehicle market.
But the wave changed in 2020, Tesla fell behind both brands of the Volkswagen Group, which had a market share of 24%, and the Renault-Nissan-Mitsubishi Alliance, with a market share of 19%. Last year, Tesla delivered almost 98,000 vehicles and accounted for only 13% of the European market.
According to Schmidt, the introduction of emission targets and the spectrum of massive fines have accelerated the fight of European carmakers against Tesla for dominance.
See also: Electric car sales reach a 54% market share in Norway in 2020, but Tesla loses first place
“With the year 2021, more and more difficult – due to the year that is gradually ending – Tesla will enter into even more intense competition,” said Schmidt. “Come in 2025, when the goals increase again, Tesla will definitely play against opponents who are fully fit and will fight potentially.”
However, Schmidt notes in its market outlook for 2021 that the opening of the German Tesla plant, expected to start production in the second half, is likely to double regional volumes next year.