After meteoric growth in EV sales across the continent, manufacturers now face a slow down as buyers react to high interest rates and economic uncertainty. VW says orders are down year on year as it looks to 2025 when it expects more cheap Chinese cars to come to market
After years of accelerating growth, Europe’s electric car sales appear to be entering a go-slow zone as drivers wait for better, cheaper models that are two to three years down the road, according to a Reuters news story today (November 15).
Fully-electric sales in Europe were up 47% in the first nine months of 2023, but instead of celebrating, automakers including Tesla, Volkswagen and Mercedes-Benz sounded a sombre note.
High interest rates and a subdued market are putting customers off, they warned, with Volkswagen’s EV order intake half what it was last year.
Dealers in Germany and Italy as well as research by four global data analysis firms say there is more behind the slower uptake than economic uncertainty, with the consumers unconvinced that EVs meet their safety, range and price needs.
“The main problem is uncertainty,” said Thomas Niedermayer, head of a 45-year-old family-owned Bavarian car dealership.
“Many assume that the technology will improve and would rather wait three years for the next model than buy a vehicle now that will quickly lose value.”
Take Flavia Garcia and Tom Carvell in Edinburgh, Scotland.
Their 15-year-old hand-me-down Toyota Auris, nicknamed Martina, needs replacing. With a petrol and diesel car ban nearing, the couple would consider an EV, but are put off by a lack of charging infrastructure, battery life fears and price.
AutoTrader says new EVs in Britain are still on average 33% more expensive than fossil-fuel models.
And most new models in the pipeline targeting entry-level consumers will not hit the market before 2025 at the earliest – by which time they will be contending with an expanded Chinese line-up from BYD to Nio in Europe.
“You want to do the right thing for the environment, but it feels like you’re setting yourself up for a very expensive investment that will make your life that bit more complicated,” Garcia, a 29-year-old corporate media director, said.
“We’ll probably get a hybrid first”.
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