The European passenger plugin vehicle market scored 158,000 registrations in January (+3% YoY), with BEVs (+14%) continuing to grow despite the drop in EV incentives in a number of markets. On the other hand, PHEVs were more affected, dropping by 10% YoY. Indeed, BEVs started the year solidly ahead of PHEVs (59% BEVs vs. 41% PHEVs). That’s a significant difference compared to the same month last year (53% vs. 47%). With the beginning of the year usually being the time when PHEVs are stronger, it looks like plugin hybrids are set to drop significantly compared to their 2022 score (39%). Are we in a inflection point where PHEVs start losing significant sales to BEVs?
Because the overall market has recovered faster (+11% YoY) than the plugin vehicle market, to over 910,000 units (much thanks to the never ending rise of SUVs and crossovers, which represented 51% of sales — the first time they were above the 50% threshold), the 2022 plugin vehicle share started the year at 17% (10% for BEVs alone). That’s 2 percentage points below January 2022 and 6 points below the full-year 2022 market share (23% PEV, 14% BEV).
Regarding other powertrains, plugless hybrids were up from 24% share in January 2022 to 26%, while petrol remained at 38% and diesel continued its slow drop into the abyss, falling from 18% a year ago to its current 16%. This meant that 43% of all passenger vehicles sold in January in Europe were electrified (to some degree).
Still, with the BEV share starting at 10%, expect the plugin market to quickly recover from January’s incentives blues and end the year with 30% plugin share, with BEVs having two thirds of that, or 20% share of the overall auto market.
In January, with Tesla starting the year at full speed and some of the heavyweights (BMW, Mercedes …) still hung over from the end-of-year peak, it was time for a few surprises at the top of the table. One interesting fact is that 4 out of the top 5 models were crossovers, which says a lot about what is hot right now.
Bring on the popcorn, because the next few months will surely be fun to watch!
Looking at the monthly model ranking:
#1 Tesla Model Y — Tesla’s crossover scored 7,626 registrations last month, thanks to the ramp-up of Made-in-Germany production and recent price cuts, which boosted the large number of units that had transitioned from December into January without a buyer and allowed Tesla to have inventory when demand picked up again. Looking back at January’s results, the main market was by far Germany (4,108 registrations), representing 54% of deliveries. It was followed at a distance by the Netherlands (492 registrations), Denmark (481), and Belgium (430).
#2 Volvo XC40 (BEV+PHEV) — With electrification high on Volvo’s priorities list, the Swedish brand is, along with Porsche, one of the two most electrified legacy automakers in Europe. So, it’s no wonder the XC40, it’s only model with BEV and PHEV versions, became the brand’s sales champion. The compact SUV hit 5,876 registrations last month, with most of them coming from the E version (3,219 units), highlighting the growth prospects of the brand — especially on the BEV side. Not only do the XC40 BEV and the fully electric and sporty C40 have much potential, but the second half of the year should witness the arrival of the much anticipated Volvo EX90, the brand’s first dedicated BEV. And that’s when fun begins…. Back to the XC40, the major markets were the UK (950 registrations), Belgium (871), and Sweden (836).
#3 Dacia Spring — The Romanian Made-in-China crossover joined the podium, with 4,239 registrations. With production constraints apparently a thing of the past, Spring deliveries are starting to become more regular. Although, with the production side of the equation now solved, one wonders how demand will behave, especially in the second half of the year when new, cheaper BEVs from local manufacturers (Citroen e-C3 EV, Renault 5, etc.) become more real and Chinese brands launch their own cheap, small models. Will Dacia have enough margin to lower prices in order to continue being the “low price king?” Looking at individual countries, sales were heavily based in France (1,911 registrations), followed from afar by Germany (669 registrations) and Romania (497 registrations).
#4 Audi Q4 e-tron — The German model hit 3,566 registrations last month, making it the best selling model based on the MEB platform. With production still ramping up, the compact Audi is benefitting from Volkswagen Group prioritising the more expensive/profitable MEB models. Regarding January performances, the Audi crossover’s registrations were mainly distributed over the following countries: the United Kingdom (1,050 units), Germany (738 units), and Belgium (341 units).
#5 Volkswagen ID.3 — The 3,432 deliveries of January didn’t allow it to start the year on the podium, but this is nevertheless a good score, and the upcoming refresh should only bolden the model’s future prospects. Regarding January, the UK (999 units) and Germany (805 units) did the usual heavy lifting, with Belgium a distant 3rd with only 353 registrations.
Outside the top 5, a mention is due for the strong month Volkswagen Group had. It placed 6 models in the table, with the first highlight being #17 Porsche Taycan leading the full size vehicle category, benefitting from the transition at Audi going from the old e-tron to the refreshed Q8 e-tron. Nevertheless, the big Audi landed in the 19th spot. Expect the flagship SUV to soon recover the category leadership position.
The second most represented OEM was Geely–Volvo. Besides the aforementioned Volvo XC40, it also placed the Volvo XC60 PHEV in #13 and the Chinese Lynk & Co 01 PHEV in #15, with this last model’s performance being even more impressive when we consider that the SUV model is not even present in a number of important markets — meaning that its margin for progression is still significant.
Regarding fresh faces, the MG 4 is already showing its pointy and distinctive face, in #18, with 2,285 registrations. And as production ramps up in China, it should continue to climb the rankings for the next few months.
Looking at the rest of the ranking, the Ford Kuga PHEV once again held the leadership position in the PHEV category, with 3,056 registrations, while the Renault Megane E had a somewhat disappointing performance, ending the month in 11th, with 2,781 registrations.
Outside the top 20, a few models deserve a mention, like the good results of the BMW i4 and iX3, which had 1,996 and 1,863 registrations, respectively. Expect the fastback to return soon to the best seller table.
In the Geely-Volvo stable, the Polestar 2 and Volvo C40 helped the OEM get good results. They had 1,828 and 1,710 deliveries, respectively. On the Volkswagen Group mothership, the highlight was the sporty Cupra Born (1,756 registrations) and Stellantis getting the e-2008 electric crossover to 1,881 registrations.
Some final food for thought for policymakers in Europe: while the most common body in the plugin top 10 is the compact-to-midsize crossover/SUV, with 7 representatives, in the overall ranking, out of the top 10 sellers, 7 are small hatchbacks or crossovers, like the Dacia Sandero, Renault Clio, and Toyota Yaris Cross. And only the Fiat 500 shows up on both rankings. That means there is a disconnection between the most popular models on the overall market and those on the plugin market.
Which reminds me of a recent comment from a reader on the France EV sales report article about vehicle bans in the city of Paris:
“1/3 of the cars in the greater Paris don’t comply with the future norms and need to be replaced by 2024. The issue is the populations that the people who own most those car are modest people. That is a big problem since this ban is hitting the poorest the most. 1/3 is a massive proportion and the fact that the most models are hit the hardest is an issue. I expect massive protests and postponing of the application of the law yet again.”
While I welcome any measure to speed up EV adoption, we still have to remember that EVs are seen by a significant part of the population as “something that xxxx are imposing on the people and that only benefits the rich, not the average Joe (or Jules).”
And because policymakers try to base their measures on the expectations of large segments of the population, including those that do not share their points of view, it is important to move forward with these bans, but at the same time, have in consideration the issues that those people have.
As such, to counter the”EVs are for the rich” argument, I think it is time for policymakers to consider reducing EV incentives on vehicles below 30,000 euros but start taxing big, heavy EVs so that the argument that it only benefits the rich becomes muted.
And to compensate the usage ban, it is crucial to have better, cheaper public transportation, to help people who cannot buy or do not want to buy an EV to continue making their daily commute to the big city.
Will cutting EV incentives to €30,000 mostly benefit Chinese automakers? Maybe at an initial stage, but it will also force local OEMs to fast forward their production plans for cheap EVs (Volkswagen ID.2, Renault 5, Citroen C3 EV, etc.).
In the manufacturer ranking, balance is the word. BMW and Mercedes profited from their long lineups and started the year in the lead, with 8.6% and 8.2% share, respectively. They were followed closely by Volvo (7.8%), which gained 1.1% share YoY, and #4 Volkswagen, which jumped from 6.2% in January 2022 to its current 7.7%.
Expect the German make to climb a few positions soon. Although reaching the #1 spot will be tough, as #5 Tesla (6.2%) should profit from its March peak to jump into the highest position in the ranking.
Just outside the top 5 we have #6 Audi, with 6.1% share. Far behind it is #7 Peugeot, with just 4.9% share.
We will have to wait until March to get a sense of the real trends for this year, but it all seems to point to another close race in 2023.
As for OEMs, Volkswagen Group started the year in front (unsurprisingly), with 20.7% share. That’s up slightly from 20.3% in January 2022. Runner-up Stellantis is at a distant 14.1%. So, the German conglomerate looks poised to have another easy win in 2023.
Geely–Volvo (10.7%) started the year in a surprising 3rd position, up 2.4% share compared to its January 2022 standing. That meant kicking BMW Group (10.3%) off the podium to 4th. Below those OEMs, Mercedes–Benz was 5th, scoring 9.1% market share, and it had a mere 30 unit advantage over #6 Hyundai-Kia (9.1%). Meanwhile, #7 Renault–Nissan Alliance (8%) is far behind.
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