Could petrol and diesel’s dominance in the EU be on the verge of ending?

30 August 2023


As the latest EU registration figures show a 12th consecutive month of growth, they also highlight the potential beginning of the end of petrol and diesel dominance. In July the market share between internal-combustion engines and electrified vehicles continued to close.

In July, figures from across the EU’s 27 member states show a new-car registration increase of 15.2% year on year. The data, released by the European Automobile Manufacturers’ Association (ACEA), suggests that issues related to supplies of semiconductors and other key components has eased.

However, it was at roughly this point last year when delivery bottlenecks started to clear, and registrations rose quickly as a result. Therefore, growth in the months ahead may well be slower, as they will be compared to a higher-than-usual base.

In the first seven months of the year, registrations across the EU grew by 17.6%, with a total of over 6.3 million new cars taking to the bloc’s roads.

There is still a long way to go for the EU market to fully recover to the levels of pre-COVID-19, with July’s registration figures down by 25.2% compared to the same period of 2019. Against the year-to-date figures, the market is down by 21.9%, an improvement month-on-month but still some way off a total recovery.

Major markets drive improvements

Growth in July was driven by the four largest markets, with France recording the best registration rate, up 19.9%. Germany was close behind with an increase of 18.1%, while Spain and Italy were some way off, but still recorded impressive figures, up 10.7% and 8.7% respectively.

All but four markets recorded growth. Hungary continued to struggle, with July registrations down by 6.8%, while Malta also saw registrations drop 6.8%, albeit on very small numbers. Sweden recorded a decline of 3%, while Slovenia saw deliveries fall by just 0.5% in the month.

Year to date, the EU’s four biggest markets helped the bloc achieve its high registration rate, with double-digit gains in Spain (21.9%), Italy (20.9%), France (15.8%), and Germany (13.6%). Only two markets have reported declines across 2023 so far, with Hungary down by 2.2%, and Sweden’s figures declining 2.5%.

Battery-electric continues rapid growth

The EU’s march towards an electric-vehicle (EV) future continued in July. Plug-in registrations, made up of plug-in hybrids (PHEVs) and battery-electric vehicles (BEVs) saw an increase of 39.9% in the month. This was driven by BEVs, which improved their registration figures by 60.6%, while PHEVs grew by 14.5% across the bloc.

Most EU markets grew their BEV markets by double- and triple-digit percentage gains, including the two largest, Germany (68.9%) and France (32.4%). Belgium recorded the highest sales with an impressive 235.9% growth. Cumulatively from January to July, BEV registrations increased 54.7% with 819,725 units.

For PHEVs, major markets like the Netherlands (107.6%), France (80%), and Spain (42.7%) helped the technology’s registrations increase. However, these larger figures were offset by a decline in Germany, the largest market for the fuel type, which ended the month down 39.5%.

Hybrid vehicles (HEVs) also helped lead the electric charge, with registrations surging 31.6% in July, thanks to solid growth in Germany (46.6%), France (32.8%), Spain (30.8%), and Italy (16.7%). This led to a 28.5% increase across the first seven months of the year, with almost 1.6 million units sold in this period.

Amongst internal-combustion engine (ICE) vehicles, the EU’s petrol market grew by 5% in July, thanks to solid results in France (16.4%) and Germany (12.5%). Between January and July, over 2.3 million units were registered, a rise of 14.3%. Meanwhile, diesel deliveries declined again, down 9.1%, despite a 2.7% improvement in Germany. In the year to date, registrations fell 2.9%.

Dynamic shift in fuel-types

The dominance of ICE cars in the region could soon come to an end, with July’s registration figures showing their market share dipped below 50% in the month.

However, electrified vehicles, made up of HEVs, PHEVs and BEVs have yet to overtake, with a combined market share of 47.1%. It is the ‘other’ category, (LPG, natural gas vehicles and hydrogen fuel-cell models), that is providing a buffer, with a share of 3%.

Yet this electrified growth is being driven by HEVs, which took a market share of 25.6% in July, up from 22.4% a year earlier. The share of plug-in vehicles also grew, to 21.5% from 17.7% in July 2022. This rise was driven solely by BEVs, which took a 13.6% market share in the month, while PHEVs retained their 7.9% share from July 2022.

Petrol saw its market share drop to 35.8 from 39.3% while the drop in diesel registrations led to a market share of 14.1% from 17.9% in July 2022.

In the first seven months of 2023, ICE still held a strong position, with 51.5% of the EU market. Petrol has a 37% market share, and diesel holds 14.5%. With the rise in registrations of HEVs, PHEVs and BEVs, it may only be a matter of time before vehicles with an electric element become the dominant powertrain in the EU. This will be helped by the continued capitulation of diesel, even while petrol remains popular.