Battery cars overtake diesel for first time in EU sales market share

Sales of full-battery electric cars surged to 15.1% of new EU car registrations in June, overtaking diesel-powered cars for the first time as the growing appeal of electric vehicles continued to displace conventional road fuel demand.

New registrations of battery-electric cars (BEVs) in the EU jumped 66% year on year to 158,252 units, according to the European Automobile Manufacturers Association (ACEA), lifting the market share from 10.7% in June 2022.

BEVs thus replaced diesel as the third most popular choice of powertrain behind gasoline and hybrid cars.

Hybrid-electric cars remained the second-most popular choice among buyers, representing 24.3% of the market.

In June, the EU gasoline car market grew 11%, totaling 379,067 units, meaning their market share decreased to 36.3% from 38.5% in June 2022.

Led by growth in the largest EU markets including Germany and Spain, the data showed more than 2 million gasoline cars were sold in the EU in the first half, down a notable 16% year on year.

The EU market for diesel cars was 9.4% lower than a year earlier, with their market share of 13.4% down from 17.4% in June 2022.

Overall, new EU car registrations increased 18% in the first half of 2023, reaching 5.4 million units and indicating the European automotive industry was recovering from supply disruptions caused by the pandemic. Cumulative sales volumes, however, remained 21% lower than 2019.

Oil displacement

The market share of gasoline and diesel cars in Europe slipped below 50% of sales for the first time during the fourth quarter of 2022, according to ACEA data.

The combined market share of gasoline and diesel cars in the EU in June stood at 49.7% of total sales, the data showed.

The loss of majority market share by conventional gasoline and diesel cars has come amid a fast-growing appetite for battery-powered mobility which accelerated after the COVID-19 pandemic despite overall falling cars sales.

Last year, the EU effectively banned sales of new gasoline and diesel cars from 2035 as part of a major policy package to achieve net-zero emissions by 2050.

The EU move requires a 55% cut in CO2 emissions for new cars sold from 2030 versus 2021 levels, much higher than the existing target of a 37.5% reduction by 2030. The UK has already banned sales of new conventional cars from 2030.

S&P Global Commodity Insights analysts have estimated that plug-in electric vehicles will displace about 1.4 million b/d of gasoline and diesel demand in Western Europe by 2035, rising to around 2.1 million b/d in 2040.

Globally, S&P Global estimates that all alternatively fueled vehicles will displace around 2.75 million b/d of gasoline over the 2030-2040 period.

S&P Global Mobility projects that the share of battery electric vehicles, plug-in hybrid electric vehicles and fuel-cell electric vehicles in new light vehicle sales in Europe will rise to 70% in 2030 from 19% in 2022.