'Lost year': Sales of electric cars in Germany fall back / Photo: © AFP
By AFP - Agence France Presse
'Lost year': Sales of electric cars in Germany plummet
Sales of new electric vehicles in Germany plummeted last year, official figures showed on Monday, as the slow shift to battery-powered cars deepened the problems of the country's main car industry.
Only 380,609 EVs were registered in 2024 in Europe's biggest car market, down 27.4% from the previous year, the federal transport authority KBA said.
After years of growth, demand for battery-powered cars has lost momentum as the German economy has struggled and major subsidies have been withdrawn.
The drop in electric vehicle sales represented a “lost year for electromobility”, said EY analyst Constantin Gall.
The sudden end of the support program in 2023, amid a government budget crisis, led to “huge uncertainty among potential buyers,” he said.
The high prices of new electric vehicle models, the still patchy charging infrastructure, and range limitations were putting off new buyers in Germany, he said.
The drop in EV sales has led to an overall decline in the German car market, which has struggled to recover since the coronavirus pandemic.
Around 2.8 million new cars were sold in 2024 in Europe's largest economy, one percent fewer than the previous year.
- Industry struggles
Weak demand for new cars in the country has exacerbated the challenges facing Germany's car industry, along with high production costs and growing competition from China.
Europe's largest carmaker, Volkswagen, announced an agreement with unions at the end of last year to reduce production capacity in Germany by around 730,000 units and cut 35,000 jobs.
The drastic cuts were necessary to put Volkswagen's flagship brand on a sustainable footing and to finance investments in the manufacturer's electric strategy, which is struggling, the group said.
VW's difficulties have not prevented it from maintaining first place in sales, with 536,888 new registrations in Germany.
Chinese manufacturers, who have grabbed market share in their home market and scared off European producers, have yet to make major inroads in Germany.
Together, brands such as BYD, XPeng, and MG Roewe sold around 25,000 units in Germany.
Tesla's market share also fell from 2.2% to 1.3%, as the US electric vehicle manufacturer sold just 38,000 units in Germany.
The general drop in sales of electric cars in Germany meant that battery-powered vehicles lost market share to traditional combustion engines and hybrid cars.
Electric cars accounted for 13.5% of sales in 2024, down from 18.4% the previous year.
Sales of hybrid cars rose by 12.7% to almost 950,000, as consumers sought to hedge their bets with cars that can run on both electricity and fossil fuel.
- Subsidy scheme -
Gall said that “strong impulses” were needed to kick-start the electric car market.
A new support program could give a “significant boost” to sales of battery-powered cars, he said, but he remained uncertain about the prospects as Germany is heading for new elections on February 23.
Chancellor Olaf Scholz, whose government scrapped the previous subsidy scheme, called during the campaign for a new support program at the European level.
Opposition politicians also called for the ailing car industry to receive more assistance, while criticizing European plans to phase out combustion engines.
Manufacturers could reduce prices on their own, as they are looking to shift more EVs and stay on track to meet stricter EU emissions targets coming into force in 2025, Gall said.
Progress in reducing EV prices could lead to an increase in sales, but the sector would struggle to surpass the volumes seen in 2023, he said.
An “expected paradigm shift” in consumer preferences is yet to come, Gall added. “For a large part of the population, combustion engines remain significantly more popular than electric cars.”
mar/fz/cw
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