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Passenger car market in Europe - statistics & facts

Europe—including the European Union, the United Kingdom, and the European Free Trade Association—accounts for around one-quarter of all new passenger car registrations. The continent is home to some of the world’s largest automotive manufacturers, such as Mercedes-Benz and BMW—which ranked across sectors among the most valuable brands worldwide in 2021— and the Volkswagen Group—one of the global market leaders in sales volume. The European Union’s positive trade balance further demonstrates the region’s importance in the sector—2021 EU exports reached some 125.45 billion euros, 25.5 billion euros of which were in the direction of the United States, which mainly imported luxury vehicles under the BMW and Mercedes-Benz brands.

Despite the sector’s importance to the region, the COVID-19 pandemic hit motor vehicle manufacturing revenue in the EU in 2020, down 16 percent year-over-year to under a trillion euros. Amid the automotive semiconductor shortage, European light-vehicle sales are forecast to not yet recover in 2022.

Challenges from multiple directions

The coronavirus outbreak led to a dramatic decline in new vehicle sales across the continent in 2020. Decreasing affordability and an economic downturn added to the lack of demand in European markets. The most noticeable drop in demand occurred in the United Kingdom, where passenger car sales peaked in 2016 and fell consistently until 2021. A weakening currency in the wake of the 2016 Brexit referendum made new vehicles more difficult. The UK’s trade relationship with the EU has also been declining in the past years: The UK was the leading importer of EU cars in 2020 but dropped to being the third importer in 2021.

This slump in the sector in the UK was also observable across the region. Headquarter to renowned brands such as Volkswagen, BMW, and Mercedes-Benz, Germany recorded the highest revenue for motor vehicle and trailer manufacturing in the EU in 2020, nearly 309 billion euros more than France, which ranked second. The German automotive industry produced over 3.1 million passenger cars in 2021—the largest automobile production in Europe— but its production volume had been in free fall since 2016 and was at its record low since 1990 in 2021. The industry was deeply impacted by production halts and lay-offs throughout the pandemic and chip shortage. 2022 brought another challenge for the German automotive industry. Volkswagen, Porsche, and BMW had to temporarily halt production in March 2022 due to supply chain disruptions resulting from the Russian invasion of Ukraine.

The road to sustainability

In June 2022, the European Union parliament approved a ban on new fossil-fuel cars from 2035, but the road to zero-emission still had miles to go. Plug-in electric vehicles (PEVs) made up 18 percent of new automobile sales in 2021, outweighed by internal combustion engine car sales, representing over 60 percent of the market. Range anxiety and inaccessible charging infrastructure are the leading German consumer concerns hampering PEV sales.

While EV adoption has been slow in Europe, some countries have stood out for their drive towards battery electric power, namely Norway, following decisive policy making from the government. Battery-electric vehicles (BEVs) have a larger market share in Norway than anywhere else, at 64.5 percent of 2021 sales. The Netherlands was the second in the region for battery electric market infiltration. In contrast, BEVs only represented 13.6 percent of the German market. Despite this, Germany was still at the forefront of the new energy vehicle market, with Volkswagen recording a strong worldwide performance. The ID.4 ranked among the five best-selling PEV models worldwide in 2021.

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In the following 5 chapters, you will quickly find the 39 most important statistics relating to "Passenger car market in Europe".

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