Can Italy’s new-car market bounce back in 2026 after a year of decline?

14 January 2026

December delivered a much-needed boost to the Italian new-car market. However, despite an eye-catching electric vehicle (EV) uplift, this did little to revive a stagnant 12 months. Following a year of inertia, what state is the sector in? Autovista24 web editor James Roberts examines the data.

Italy’s new-car market ended 2025 in decline. Across the year, 1,524,843 new vehicles took to the country’s roads, 33,228 fewer than 12 months prior. Compared to 2024 figures, this marked a 2.1% year-on-year dip, according to the latest data from ANFIA.

Conversely, December witnessed a year-on-year improvement in fortunes. The final month of the year saw 108,075 new vehicles join Italy’s car parc. This was an upswing of 2.3% and 2,390 units, according to Autovista24 calculations of ANFIA data.

However, this was the second-lowest monthly registration total of the year after August. Following a blunt 0% growth in November, December did signal a welcome positive rebound for the first time since September.

In terms of electrification, Italy’s EV uptake conundrum was laid bare. Throughout the year, battery-electric vehicle (BEV) and plug-in hybrid (PHEV) registrations have increased. This was boosted in November and December by quickly exhausted incentives. Despite this flash of prosperity, across the whole year, the plug-in market share has struggled to make a meaningful impact.

Hybrid powertrains, including full and mild versions, accounted for the highest volumes in 2025. This was reflected in the end-of-year deliveries and market share. Meanwhile, petrol and diesel continued a pattern of decline.

High EV sales too little too late?

In total, 21,925 new EVs were registered in December, including BEVs and PHEVs. This was the second-highest monthly total of 2025. The powertrain group saw a 130.3% year-on-year uptick, to the sum of 12,406 additional vehicles.

PHEVs had a particularly good December, with 9,851 registrations. The powertrain established a 165.4% year-on-year volume gain, plus a 9.1% market share, up 5.6 percentage points (PP). This was the fourth consecutive month of triple-digit increases for PHEVs.

Meanwhile, BEVs scored a second month of triple-digit increases. In total, 12,074 new all-electric vehicles reached customers in Italy. This propelled the monthly BEV market share to 11.2%, a significant 5.7pp increase compared with December 2024.

On the one hand, this December EV result is cause for celebration. Building on November’s peak EV volumes, it seems some momentum could be carried forward into 2026. However, November and December’s PHEV and BEV upswings were fueled by fleeting national incentives.

This is not unusual, and countries such as Spain have harnessed EV incentives effectively in 2025 to boost adoption. However, in Italy, the new-car market has been punctuated by short-lived and inconsistent policies. This uncertainty has stunted EV adoption.

EV momentum likely to fade

In late October, the Italian Ministry of the Environment and Energy Security (MASE) confirmed new EV incentives.

Under Italy’s National Recovery and Resilience Plan (PNRR), private buyers could receive up to €11,000 toward a new EV. This was subject to household income and the scrapping of a Euro 5 or older internal-combustion engine (ICE) car. Small businesses could claim up to €20,000 for an electric light- commercial vehicle (LCV).

The scheme had a total budget of more than €597 million, with a view to replace about 39,000 ICE vehicles. However, the incentives were fully claimed for use within 24 hours of launch, MASE confirmed.

In the short term, this had the desired impact. Immediately following the incentive launch, plug-in registrations breached 20,000 in November. This momentum prevailed into December, helping to ensure a monthly share high of 20.3%, a sizeable 11.3pp surge.

‘What really stands out is the market share of BEVs, which reached 11.2% in December,’ affirmed Marco Pasquetti, Autovista Group’s cluster head of forecasting for Spain and Italy. ‘This is remarkable considering that for most of the year the share hovered around 5%.

‘This increase was expected and is largely the result of the incentive scheme launched in October, which generated some 55,700 vouchers for the purchase of an equal number of vehicles. Since the bonus is no longer available, this positive momentum is likely to gradually fade in the coming months,’ he added.

Poor PHEV and BEV market share

Assessing 2025 as a whole, the EV market share in Italy has increased significantly. However, as ANFIA outlined, growth remains ‘very slow.’ When isolating BEV and PHEV powertrains, the relative lack of impact in the overall market is apparent.

In all, 192,964 EVs took to Italian roads in 2025, according to ANFIA. This proved to be 74,652 more than the previous year, a 63.1% increase. EVs secured a 12.7% share, one of the lowest of the major European new-car markets.

98,340 PHEVs left Italy’s forecourts in 2025. While this signalled a satisfying 86.6% year-on-year volume increase, the overall market share stood at 6.4%. This was the second lowest of Italy’s six propulsion categories, according to Autovista24 analysis of ANFIA data.

Just 3,716 units behind, BEVs ended the year with 94,624 registrations, up 44.2% on 2024 totals. Despite the clear gains, the powertrain made up the lowest share of Italy’s new-car market at 6.2%. This was an increase of just 2pp year on year.

Hybrid decline on the horizon?

Across the whole of 2025, hybrid power proved the most popular choice for Italy’s new-car buyers. Amid stop-start and sluggish EV inroads, the thirst for this powertrain remained strong. However, despite this apparent Europe-wide trend, are things changing?

Complete ANFIA data for 2025 revealed that 671,923 hybrid vehicles were sold in Italy last year. This secured the largest portion of the country’s new-car market at 44.1%, up 4.1pp year on year. Aside from the holiday month of August, December returned the second-lowest hybrid volume of 2025. 46,048 units were delivered in the month, carving out 42.6% of the market.

While dominant, the hybrid share fell throughout the year. Compared with January, hybrid’s hold was down by 2pp in December. Although relatively small, it could suggest buyers could be turning towards alternative powertrain options.

Electrification creeping up

One was certain across Italy’s new-car market in 2025. When it comes to electrified vehicle registrations, hybrids provided the backbone.

Adding hybrid figures to EV volumes, these powertrains accounted for 56.7% of the Italian new-car market in 2025. In total, 864,887 units heralded a 16.7% year-on-year volume increase.

Removing hybrid totals drops the market share to just 22.6%. In many ways, this illustrates the double-edged sword of hybrid success. The powertrain could be a gateway from ICE to fully-electric cars. However, its enduring appeal amid overall low sales totals is stunting the EV transition.

The European Commission’s recent Automotive Package could see Italy standing at a crossroads. With the sale of new ICE vehicles, including mild hybrids, potentially extended beyond 2035 in the EU, questions have emerged domestically.

These changes could dent EV uptake, further hindering growth and market diversity in Italy. This is amid already uneven incentive frameworks. Industry bodies such as UNRAE have cited the Commission’s proposal as a ‘starting point, but not yet satisfactory.’

‘Critical issues remain and aspects to be clarified and improved to avoid negative effects on the market, consumers and industrial competitiveness,’ elaborated UNRAE president, Roberto Pietrantonio. ‘The transition must be effective and practicable, not just ambitious, and to become so it needs realism and listening. Adequate tools are needed, such as a review of the taxation of company cars, widespread development of electric charging infrastructure, and affordable charging tariffs.’

Decline for petrol and diesel?

While it may go against the grain of green targets, Italy’s ICE sector proved resilient amid a trend of decline. ICE totals, including petrol, diesel and bio diesel variants, accounted for 519,563 registrations in 2025. This meant a market share of 34.1%, down from 43% in 2024.

The continued decline of ICE demand in Italy is not in doubt and is reflected across most of Europe. The powertrains have been able to maintain a strong grasp on the overall new-car market. However, examining petrol and diesel registrations in isolation reveals significant drops.

Petrol ended the year 18.2% down on 2024, while diesel underwent a drastic 31.6% slide. However, both these fuel types held higher respective market shares than individual PHEV and BEV variants. After hybrid powertrain volumes, petrol clearly remains the second most popular new-car choice with 24.4% of the overall market.

Made up of liquified petroleum gas, compressed natural gas and hydrogen fuel-cell vehicles, the ‘other’ category ended 2025 strongly. It held a 9.2% market share, down just 0.2pp. It ended the year as the fourth most popular fuel type grouping, and another thorn in the side of EV uptake.

Unseating ICE resilience, as well as hybrid dominance, will be key to boosting the relatively scant EV market share in Italy. New incentive packages will be central to increased EV market share in 2026, which UNREA highlights as a ‘key year for the future of the sector.’