|According to the figures of the European Car Manufacturers Association ACEA, in January, the European Union passenger car market grew by 11,3% to 760 041 units, starting the new year on a positive note.
However, one must consider that this was mainly due to an unusually modest comparison base in 2022 when the lowest January volume on record was reached. The car industry is hoping for a 5% increase in sales for the whole of Europe in 2023. It remains to be seen if these figures can be realized.
At a country level, the region’s positive performance was reflected in three of the four most significant markets. The strongest gains were seen in Spain (+51,4%) and Italy (+19,0%), followed by France, with a more modest but still solid growth (+8,8%). The exception to this trend was Germany, which recorded a 2,6% decline last month, but one has to consider that there was a big sales hype in December last year in Germany.
Electrified growth, PHEV regress
During the first month of 2023, battery-electric and hybrid passenger car registrations in the EU continued to grow, accounting for 9,5% and 26,0% of the market, respectively. Nonetheless, gasoline remained the most popular fuel type for newly-registered cars in the EU, with a market share of 37,9%.
January registrations of new battery-electric vehicles (BEVs) increased by 22,9%, reaching 71 984 cars registered across the EU and thus a market share of 9,5% (against 8,6% in January 2022). Most of the region’s markets contributed significantly to this growth, with double- and triple-digit percentage gains.
However, there were a few exceptions in some of the EU’s biggest volume markets for this powertrain: Germany (-13,2%), Sweden (-18,5%), and Italy (‑8,7%). Changes in incentives or tax cuts for electric vehicles in some countries must also be considered.
Hybrid electric vehicles (HEVs) also had a solid start to the year. Their volumes grew by 22,1% to 197 982 units, sustained by double-digit gains in the region’s four biggest markets: Spain (+59,3%), Italy (+24,7%), Germany (+19,0%), and France (+12,5%). This resulted in a market share of 26,0%, a 2,3 percentage-point improvement compared to January 2022.
The continuing growth in Europe of the number one hybrid car producer, Toyota, has undoubtedly played a role here. Furthermore, one has to consider that many individual buyers in the EU seem not ready yet for the fully electric car and choose an electrified ‘self-charging’ hybrid.
On the other hand, plug-in hybrid vehicle (PHEV) sales in the European Union declined by 9,9% to 53 649 units in January, as registrations more than halved in Germany (-53,2%), which until last year was the largest market by volume for such cars.
Once again, we must consider the high scores in December in Germany, but the tendency that PHEVs are losing ground is probably here to stay. In total, the EU market share for PHEVs contracted from 8,7% in January 2022 to 7,1% this year.
ICE cars: gasoline up, diesel down
Registrations of new gasoline cars in the EU recorded a 12,3% uplift in January, contributing to the expansion of their market share to 37,9% (against 37,6% in 2022). All the region’s major markets contributed to this growth: Spain (+59,4%), Italy (+15,5%), France (+11,9%), and Germany (+3,5%).
By contrast, the EU’s diesel car market struggled again, declining 1,6% last month despite a notable increase in Italian (+21,4%) and Spanish (+19,0%) registrations. This resulted in a drop of two percentage points in market share, from 17,9% to 15,9%.
The registrations for other types of fossil fuels (CNG, LPG…) remain too low to be significant. All-in-all, we see that the initial surge of electrified vehicle sales is slowing down a little, while on the fossil side, diesel is continuing its decline. The rise in gasoline sales can partly be attributed to cars with an extended delivery time finally being delivered to their customers.
EFTA and UK
When we take a brief look outside the European Union, we see a severe decline in sales (-23,1%) in the EFTA countries (Iceland, Norway, and Switzerland), mainly because the sales of BEVS and PHEVs were collapsing over there (-53,1% and -28,8% respectively). The hype of electrification seems to be tempered over there.
In the UK, the market has risen by 14,7% in January, mainly due to the increase in sales of BEVs (+19,8%) and hybrids (+21,1%) but also gasoline cars (+14,6%). Here also, diesel is further regressing by 12,1%, resulting in a market share of only 4% anymore.
The Volkswagen Group remains the biggest seller in the EU in January, with a 26% market share (-0,1%) and a sales increase of 10,6%. Second, comes Stellantis, with an 18,6% market share (-1,9%), and the third is Renault Group, climbing to an 11,7% market share (+1,3%), increasing its sales by 24,6%, mainly due to low-cost daughter Dacia (+42,6%).
Other climbers are the Hyundai Group, fourth with a 3,1% increase in sales and a 9% market share, followed by Toyota Group (8,2% market share and 12,6% sales increase). A very steep increase in sales was noted for Tesla, going from an incredibly low 731 cars sold in January 2022 to 8 749 cars this January (+1069,8%).
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