Electric car sales are not taking off in lower-income EU countries

In lower-income EU countries are sold little to no EVs. There is a correlation between the affordability of electric cars and their market uptake. All countries with an EV market share of less than 1 percent have a GDP per capita below €29,000, appears from an analysis of ACEA.

The European Automobile Manufacturers’ Association (ACEA) analysed the electric car sales of all EU countries and compared them with the GDP per capita in the EU member states for the full-year 2018. Turns out that all countries with an EV market share of less than 1% – that is half of all EU member states – have a GDP per capita below €29,000. This is the case in several southern countries – such as Spain, Italy and Greece – as well as in Central and Eastern European countries, like Lithuania, Bulgaria and Slovakia.

Contrast

In Latvia, for instance, only 93 electric cars were sold last year. Poland has the lowest uptake of electric cars in the EU, with an EV market share of just 0.2 percent. By contrast, an EV share of above 3.5 percent only occurs in countries with a GDP of more than €42,000, like Finland, the Netherlands and Sweden.

Mass production

Electric cars are still expensive compared to diesel and gasoline cars. The price only decreases if the numbers of EVs that the manufacturers build increase to mass production. Experts and trend watchers expect that within 5 years the price of an electric car will be the same as that of a conventional one.  Until then an electric car without a subsidy is a major investment.

Bonus payments

The Italian government recently approved an ecobonus programme with substantial purchase subsidies for electric cars [link to the article], both for private consumers and companies. ACEA calls on other less rich countries to encourage the purchase of electric vehicles. In nearly all EU states are fiscal measures available to stimulate electric car sales, but the nature and monetary value of these benefits varies widely. Indeed, while most countries grant simple tax reductions or exemptions for electric cars, only 12 EU member states offer premiums or bonus payments to buyers of these vehicles.

No matter which country you live in

Erik Jonnaert is ACEA’s Secretary General and he says that besides investing in charging infrastructure, governments need to put in place meaningful and sustainable incentives in order to encourage more consumers to make the switch to electric. “People throughout the EU should be able to consider purchasing an electric vehicle, no matter which country they live in, north or south, east or west. The affordability of the latest low- and zero-emission technologies needs to be addressed by governments as a matter of priority.”

Reduction targets

The EU institutions recently approved the new CO2 regulation for passenger cars, setting reduction targets of -15% and -37.5% for the years 2025 and 2030 respectively. These targets will follow on from the target of 95g CO2/km for the year 2021, set in 2013. Sales of electric and other alternatively-powered cars will have to pick up strongly if these CO2 targets are to be achieved. Unfortunately, however, in 2018 only 2% of all new passenger cars registered throughout the EU were electrically-chargeable.