EU (commonwealth) Since sales of electric cars are predicted to grow rapidly, automakers will have no trouble meeting the EU’s climate targets next year, according to new analysis. Transport & Environment (T&E) modelling based on sales in the first half of this year and sales estimates indicates that electric automobiles (BEVs) should attain between 20–24% market share in 2025.
A number of manufacturers, concerned about the slowing sales of electric vehicles, are urging the EU to activate a special crisis clause in order to postpone their CO2 objectives by two years.
According to T&E’s basic scenario, however, BEVs will account for an average of 60% of the remaining CO2 reduction that automakers must do in order to meet EU emissions objectives next year.
Seven new fully electric vehicles under €25,000 that have arrived or will be available in 2024 and 2025 will contribute to this.
T&E’s director of automobiles, Lucien Mathieu, predicted that 2025 will be a fantastic year for Europeans looking to buy an electric vehicle. Thanks to an abundance of new, more affordable models, BEVs should account for over 25% of newly sold automobiles. However, automakers’ reliance on hybrids is a shortsighted approach to the climate and competing with Chinese BEVs, as these vehicles are nearing the limits of their ability to save CO2.
While BEVs would have the biggest impact, Stellantis and Volkswagen Group anticipate that hybrid vehicles (HEVs) will account for 33% and 30%, respectively, of the remaining CO2 reduction needed to meet EU standards.
The central scenario used in T&E’s modelling, which is based on sales projections provided by market research firm GlobalData, suggests as much. Sales of hybrid vehicles should also help Mercedes-Benz (17%) and Renault (15%) close major portions of their respective emissions gaps.
Based on the central scenario, BMW is anticipated to rely on plug-in hybrids in addition to its fully electric cars to meet the EU 2025 objective by reducing emissions by 18%.
According to T&E’s high HEV scenario, manufacturers would have a 20% overall BEV market share next year, compared to 24% in the central scenario, if they were to rely more heavily on selling hybrids in order to comply. Volvo Vehicles is already compliant in all situations because of its significant sales of BEVs.
According to the report, automakers can “pool” with other manufacturers to further reduce their average emissions if they continue to struggle. In 2025, only 17% of VW’s sales—rather than 22%—would need to be BEVs if it pools with Tesla. Ford would only need to sell 9% of BEVs instead of 21% of total sales if it pooled with Volvo, as it did in 2021.
Ursula von der Leyen, chief of the EU Commission, declared in July that the group will achieve its goal of having zero-emission cars by 2035. The car industry called for the German government to reduce the 2025 aim, but they were rebuffed last week.
T&E is urging national and EU legislators to take more action to encourage the use of EVs by implementing programs like social leasing, corporate fleet targets, and charging masterplans.
“We welcome that President von der Leyen and the German government have ended the uncertainty surrounding the car CO2 targets,” stated Lucien Mathieu. It’s time for the EU to encourage the use of electric vehicles by establishing fleet electrification goals for businesses.
Governments must provide a consistent regulatory framework for EVs with nationwide charging objectives and focused assistance for purchasers. Within the EU car CO2 regulation’s jurisdiction (i.e., sales in the EU, Norway, and Iceland), market share is defined.
To meet the EU’s 2025 CO2 targets, T&E has created a series of scenarios that illustrate varying degrees of reliance on hybrid cars and regulatory latitude. All automakers are expected to have higher hybrid sales in T&E’s high HEV scenario as compared to a baseline set by GlobalData’s sales projection. Under T&E’s high BEV scenario, BEVs would be the primary emphasis of automakers. In the interim, each automaker’s unique modelling serves as the foundation for T&E’s central compliance scenario.
This scenario is based on modelling the percentage of BEVs and HEVs needed to reach the targets, assuming that all automakers would comply without pooling. It is informed by GlobalData’s projection and the published plans of automakers. The final scenario considers a combination of two leaders and the two lagging automakers.
