Europe's New Car Sales Jump 13.9% in 2023, EVs Surpass Diesel for the First Time

New car sales in Europe surged by 13.9% in 2023, marking a significant recovery from the slump experienced in 2022, when new vehicle registrations hit their lowest levels since 1993, according to a report by AFP.

"The overall volume for the full year of 2023 surpassed 1.5 million units, reflecting a substantial 37% increase compared to 2022. The battery-electric car market share reached 14.6% in 2023," the European Automobile Manufacturers' Association said in an official statement.

EV Surpasses Diesel for the First Time

The European Automobile Manufacturers' Association reported this positive shift, highlighting the rebound in new car sales across several key markets, particularly in France, Italy, and Spain, which posted double-digit increases compared to the previous year.

An interesting development emerged as electric vehicles (EVs) surpassed diesel for the first time, signifying a transformative trend in the automotive industry. Sales of new electric cars experienced a remarkable 37% year-on-year increase, constituting 14.6% of the overall sales, according to the association's findings.

Notably, Tesla, led by Elon Musk, witnessed a near doubling of sales in the region, with its SUV Model Y claiming the top-selling vehicle title in Europe, totaling 279,000 units.

The figures starkly contrasted the challenges automakers faced in 2022 due to component shortages, resulting in the lowest vehicle registration levels in decades. However, the resurgence in new car sales in 2023 showcased a positive trajectory, albeit remaining below pre-COVID levels.

Phase Out of Combustion Engine Vehicles

One of the driving factors influencing the shift in the automotive landscape is the European Union's directive for automakers to phase out sales of new combustion engine vehicles by 2035. In line with this, hybrid cars also experienced a surge in sales, witnessing a nearly 30% increase.

Interestingly, plug-in hybrids, equipped with both a thermal engine and a rechargeable electric battery, faced a decline in sales for the first time, declining by seven percent. This downturn was attributed to the phasing out of government incentives in various regions.

Meanwhile, Petrol cars continued to be a significant presence in the new vehicle market, representing 35.3% of Europe-wide sales in 2023, equivalent to 3.7 million cars.

Volkswagen also maintained its leading position among car manufacturers, selling 2.8 million new cars in 2023, reflecting an 18% increase from the previous year. French automaker Renault also reported sales growth of 16.9%, while Stellantis saw a more modest increase of 2.9%.

The European Automobile Manufacturers' Association's report emphasized the positive trajectory of the EU car market in 2023, with a 13.9% expansion compared to 2022, totaling 10.5 million units. The growth was observed in all EU markets, with notable double-digit gains in major markets such as Italy, Spain, and France.

While the overall outlook for the European new car market in 2023 is positive, the industry continues to navigate challenges, including the evolving landscape of electric and hybrid vehicles, meeting regulatory deadlines, and responding to market demands for sustainable and innovative transportation solutions.