Sales trends for electric vehicle (xEV) models in Europe are diverging, with Germany, the region's largest market, seeing non-plug-in hybrids pull ahead of battery electric vehicles (BEVs) and plug-in hybrids (PHEVs), further widening the gap.
Across Europe, demand for alternative powertrains has split. Luxury buyers continue to embrace BEVs and PHEVs, with double-digit sales growth in the first seven months of the year. However, sales of mass-market models have stalled, echoing the situation in Germany after subsidy cuts.
Germany's decision to end BEV subsidies at the end of 2023 has led to a sharp drop in sales in 2024, while non-plug-in hybrids are gaining ground. Data from Germany's Federal Motor Transport Authority (KBA) shows new vehicle registrations for January through August fell 27.8% year-over-year, with BEVs plunging 68.8%.
Two factors are driving these numbers. In 2023, pandemic-induced order backlogs pushed registration numbers higher than demand. By 2024, the market had normalized.
Additionally, when the German government ended subsidies for commercial buyers in September 2023, a last-minute buying rush drove August sales up. Since businesses constitute a large portion of BEV sales in Germany, a sharp decline followed.
Industry players cite the subsidy cuts as the main driver behind Germany's BEV slump, exacerbated by a lack of charging infrastructure, range anxiety, rising electricity prices, and inflation denting consumer purchasing power.
Long winters and cold temperatures in Europe further dampen BEV appeal, as lithium battery ranges often fall short of advertised figures, a major deterrent for many buyers. PHEVs, meanwhile, struggle as consumers stick to the convenience of gas stations and underuse charging stations, blunting the emissions-reduction benefits. High prices have also weighed on PHEV sales across Europe in recent years.
In Germany, nearly half of all vehicles sold in the first eight months of 2024 were alternative powertrain models. Non-plug-in hybrids have seen the fastest growth, reaching a record 28.3% market share, up 3 pp from earlier in the year.
Looking at the broader German market, non-plug-in hybrids now hold a 28.3% share, compared to 13.7% for BEVs and 6.9% for PHEVs.
This trend reflects consumer preferences across Europe. Market segmentation shows a clearer picture: high-end buyers are still choosing BEVs and PHEVs.
According to industry tracker Dataforce, BEV sales in the premium segment across the EU, EFTA, and UK jumped 23% in the first seven months of the year, while PHEV sales rose 14%. By contrast, mass-market BEV sales fell 6.9%, and PHEVs dropped 18%.
Tesla's Model Y, the leader in mass-market BEV sales, saw a 25% year-over-year decline amid growing competition. Volkswagen's ID.4 sales slipped 32%. In contrast, premium BEV sales surged, led by the Volvo EX30, BMW iX1 (up 54%), and Mercedes-Benz EQB (up 48%). Among high-end PHEVs, the Mercedes E-Class soared 297%, while the Audi A3/S3 rose 175%.
