EVs Storm To 500,000 Sales In Europe, But Where Is Tesla?

Electrified car sales in Europe overtook China in July for the first time in a decade, and it did it all without significant impact from EV halo brand Tesla
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The Electric Car Report shows that Europe swallowed up half a million electric (EV) and plug-in hybrid (PHEV) cars in the first half of the year and is on track to sell a million plug-in cars this year for the first time in its history.

Western Europe has also outpaced China for the first seven months of 2020, even with Covid-19’s dragging impact.

The report, compiled by independent Berlin-based auto industry analyst Matthias Schmidt, showed that western Europeans bought up 53,000 pure battery electric cars (EVs) during July.

Combined with plug-in hybrid (PHEV) sales, electrified cars attracted nine percent of western Europe’s car buyers for the first seven months of the year.

The plug-in sales were split between 269,000 EVs and 231,000 PHEVs (though PHEVs outsold EVs in July), outstripping the 486,000 plug-in cars registered in China in the same period.

European pure EV volumes climbed 34.3 percent year-on-year in the first half, outpacing the full-year 2018 volume, in a year that has seen the market contract 40.1 percent.

Heavily driven by a combination of subsidies and auto makers swimming away from heavy EU7 CO2 fines for failing to meet tighter emissions targets, the take-up rate of electrified cars in Europe has more than doubled in the last year.

With July setting a record for pure EV power at 53,000 units, Schmidt expects the surge will continue, even if EV supply will be choked down once automakers meet their EU7 obligations.

With its auto sales shattered by the Covid-19 pandemic, Germany now delivers a €9480 (US$11,205) subsidy for EVs, with €3480 of that chipped in by the OEMs.

France, home to Europe’s biggest EV maker, Renault, has an even bigger subsidy, at €12,000 (US$13,000), which helped drive its plug-in market share to 9.5 percent in July. On top of that, the nation also has a €5000 scrappage scheme for older cars, conceivably knocking €17,000 off the price of a sub-€40,000 electric car.

The result has been outrageous leasing plans that has seen cars like the electric smart on offer for closer to zero a month than €100.

There will be more than a million PHEV and EVs sold in Western Europe this year, Schmidt insisted, with the second half boosted by the arrival of Volkswagen’s ID.3 EV.

Volkswagen still plans to build 100,000 MEB cars (split between the ID.3 and the ID.4 SUV) before the end of the year, but even without the ID.3, plug-ins now accounts for 7.9 percent of all German passenger car production.

Other MEB-equipped electric cars will soon be in Ford, Audi, Seat and Skoda lineups, and the Volkswagen Group also has three premium EV platforms, like the older C-BEV architecture for the Audi e-tron, the J1 for the Porsche Taycan and the Audi e-tron GT and the upcoming PPE platform for every brand from Bentley to Porsche.

Its own projections see Volkswagen with six percent of the pure EV market in Europe this year, and it already owns 4.1 percent thanks to the e-Golf and the e-Up.

“Full year western European volumes remain on target to touch a million units, with a large push expected in H2 to meet CO2 compliance, and more Tesla units being available to the European market and Volkswagen Group MEB-based model roll-outs,” he explained.

The PHEV push is being driven by longer EV range, with the latest generation of PHEV models pushing their zero-mission mileage out to 50km, 80km or even 100km.

This push has happened almost without Tesla’s traditional 12^th-week surges, with just two shiploads of Fremont’s finest arriving in the first half of the year.

“Although Tesla managed to remain the largest single brand in terms of BEV volumes during the first half of the year, 12-month rolling totals have been consistently falling, with 12-month volumes up to July likely to dip below 100,000 units for the first time since the period up to November 2019,” Schmidt explained in the report.

“Its market share halved to 15.2 per cent during Q2 from a peak 33.8 per cent in Q3 2019, partially fuelled by… limited supply from other manufacturers, unprepared to push BEV units prior to CO2 fleet average limits changes in 2020.

“Tesla was also likely unfavorably contributed to by COVID-19 shipping delays to Europe following a production stop at its Fremont facility where all European models are manufactured.”

Tesla’s 36,652 sales lead Renault’s 35,936 and Volkswagen’s 24,670, though the tables turn when the entire group power of the two European corporations is considered.

Then, the Renault-Nissan-Mitsubishi Alliance leads Europe with 48,835 EVs, while Volkswagen (whose umbrella covers the Porsche Taycan and the Audi e-tron) rises to 47,188.

The second-generation Renault Zoe has lead the way for EVs in H1, selling more than 10,000 in June alone and 35,500 for H1.

The Zoe headed Tesla’s Model 3 (33,100) in second place and Volkswagen’s low-range e-Golf (17,600) in third.

Of the top 10 plug-in models in the first half of the year, seven were pure EVs, with the Audi e-tron in fifth, the Peugeot e-208 in sixth, the Nissan leaf in seventh and the Hyundai Kona EV in eighth.

The Mitsubishi Outlander, in fourth, was the leading PHEV, followed by the Volvo XC60 and the Volkswagen Passat.

Incentives on plug-in hybrids are so significant that the Passat GTE PHEV can now be leased in Germany from as little as €79 ($93) a month over four years.

China has long been the world’s hub of affordable plug-in cars thanks to its support of “new energy vehicles” but Europe has overtaken it this year as China has reduced its subsidies.

There has been widespread fear over the EU’s brutal penalties for missing its EU7 emissions targets, which include a fine of €95 for each gram over the limit, multiplied by every car the breaching company sells in 2020 and 2021.

But Schmidt believes most companies will meet their obligations organically, with only Daimler and Fiat Chrysler Automobiles (FCA) in any danger of missing (and FCA pays Tesla for credits).

“I believe the 2020/21 EU CO2 targets are achievable due to the PHEV comeback, to more than 50 percent of the mix for large vehicles, plus a rise in EV supply and 48-Volt mild-hybrid systems,” he said.

The richest EV model mix in Europe remains Norway, with 43.9 percent of the total car market so far this year, followed by The Netherlands (11.3 percent) and Iceland (10.3 percent).