EU electric vehicles sales decline amid subsidy cuts

BRUSSELS: Europe’s automotive industry reported a 12 per cent drop in sales of new electric vehicles (EV) in the European Union (EU) for the month of May compared to the previous year.

Germany alone experienced a significant 30 per cent decrease.

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Despite being the largest EV market in the EU, Germany terminated subsidies for EV purchases in December as part of its 2024 budget deal. This resulted in a 16 per cent year-to-date decline in EV sales.

Overall, new car sales across the EU declined by 3 per cent in May compared to the same period last year. The wider region, including the EU and Britain, saw a 2.6 per cent decrease in new car registrations during this period.

To protect domestic automakers, the European Commission announced plans to impose provisional duties of up to 38.1 per cent on Chinese-made EVs starting July.

Elon Musk’s Tesla also plans to raise prices for its China-made model 3 vehicles in the EU, responding to a 34.2 per centdecline in regional sales in May.

Fully electric models and hybrids collectively represented 48.9 per cent of all new passenger car registrations in the EU for May. However, the market share of fully electric cars decreased to 12.5 per cent, while hybrid vehicles increased to 29.9 per cent, compared to the previous year.

Volkswagen reported a 1.6 per cent increase in EU registrations in May, while Renault experienced declines of 5.4 per cent. Meanwhile, Toyota saw a notable sales growth of 13 per cent during the same period.

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The EU electric car market is currently adjusting to policy changes and economic factors. Industry experts expect recovery as stricter emission regulations and sustainable mobility solutions continue to evolve.