- Slashing incentives for electric vehicles pushes the share of BEVs below par in the first months of 2024. Stricter CO2-targets force recovery in 2025 at the latest.
- With strong domestic brands, newcomers encounter a True Fleet market that is difficult to penetrate, while private markets prove much more permeable.
- Small and large SUVs now make up for more than half of PC Registrations in the EU27+NO,IS,SUI.
Share of BEV in registration will overtake ICEs by 2029
In the wake of a market recovery, sales of Internal Combustion Engine (ICE) vehicles have surged so far in 2024, while the shares of Battery Electric Vehicles (BEVs) have stagnated, a phenomenon attributed to a reduction in grants. As we move into 2025, the automotive industry is about to experience a significant shift. Stricter CO2 emission targets will lead to a substantial increase in the adoption of eco-friendly vehicles.
In the subsequent years technical progress, economies of scale, and the emergence of new competition will collectively foster price cuts and lead to significant improvements in the range and charging capabilities of electric vehicles.
Hybrids and Plug-in hybrids serve as a bridging technology during this transition. They play a crucial role in attracting former petrol and diesel drivers, although a significant proportion of consumers made a direct switch to battery electric vehicles. The road ahead for ICE vehicles looks challenging, with impending driving bans for diesel vehicles due to environmental concerns on the horizon. Despite this, petrol vehicles continue to hold their dominance. This trend is expected to persist until BEVs become more affordable and CO2-pricing mechanisms make fossil fuels more expensive.
Most popular make by country
VW is the most popular brand in new PC registrations 2023 for True Fleet customers in 8 out of 30 European countries. In fact, the most popular make in more than half of the 30 covered European countries belonged to the VW group, which includes besides VW itself among others also Skoda and Audi. This success can be attributed to the widespread appeal of its most popular models Skoda Octavia, VW Tiguan and VW Golf. In particular the Skoda Octavia retains consistently its spot as the most popular model in the overall European True Fleet market in 2023, which it has held since 2020.
The strength of domestic brands in the True Fleet markets of their respective home countries is largely due to their robust B2B marketing networks. These networks represent a significant barrier to entry for newcomers, making the True Fleet markets especially hard to penetrate in countries with large automotive industries. In private markets newcomers and non-domestic brands find it much easier to establish themselves. A prime example of this is Dacia, which managed to outperform domestic brands in the private market in both France and Italy in 2023, albeit by a slim margin. The Dacia Sandero retaining its position as the most popular PC model for private European customers in 2023.
SUVs continue their rise to market dominance
In the European market, SUVs now account for over 50% of new passenger car (PC) registrations, with small/compact SUVs at 39.9% and medium/large SUVs at 13.7%. Traditional PC segments hold less market share, with mini/small and compact/medium cars each around 19.5%, and large PCs at 1.7%. This shift towards SUVs is influenced by the release of numerous models over the past decade and strategic decisions during the semiconductor shortage, OEMs prioritized larger cars.
The trend over the last five years shows a clear preference towards SUVs in both private and True Fleet markets. From 42% of PC registrations in 2019 to 56% in 2023 in private markets and from 37% to 52% in True Fleet markets, SUVs grew at the expense of the share of the medium, compact, and smaller PC segment. As one of the first cities in Europe, Paris authorities plan to increase parking fees for large visiting vehicles, following a referendum, which could indicate the dissatisfaction of the public, as SUVs are seen as placing a disproportionate strain on the infrastructure, possibly paving the way for further regulation to discourage both manufacturers and customers from bigger vehicles.
About the study
The “EU Passenger Car Report 2024” is a comprehensive study that provides detailed insights into the European passenger car market. The report combines data on passenger car registrations from 30 European countries (EU27+NO,IS,SUI) with over 25 years of market knowledge from Dataforce. The report delivers an in-depth analysis of the market, including current and future trends and developments. The study covers PC registrations in Total Market as well, as both Privat and True Fleet Market channels, including the share of battery electric vehicles, the top make by country and the most popular vehicle segments. The report also features an overview of the development of the Rent-A-Car and Dealer/Manufacturer channels within the EU car market. A Forecast up to 2029 for the total market, as well as per market channel and fuel type completes the study.
