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Europe’s new car market struggled during 2024’s first quarter, thanks to persistently high inflation and interest rates causing a slowdown in demand.
That’s according to latest data from JATO Dynamics for 28 European markets, which revealed year-on-year declines in registrations in 23 countries.
Registrations totalled 1,377,541 units last month – a 2.7% decrease versus March 2023. But registrations in Q1 were up by 4.8% on Q1 2023 at 3,380,048 units.
Felipe Munoz, global analyst at JATO Dynamics, which sponsors the Car Dealer Podcast series, said: ‘Although registration figures for the first quarter of 2024 paint a reasonably positive picture, the data for March is concerning.
‘The average price of a new car is still prohibitively high, and consumers are understandably hesitant about making the shift from petrol- and diesel- powered vehicles to electric models.’
He added: ‘Instead of embracing the shift, uncertainty over regulation and a lack of clarity on incentives available for EVs in many European markets is putting off potential buyers.
‘Worries about the lifecycle of the batteries in these vehicles is another source of concern among consumers.’
The drop in consumer confidence in electric vehicles (EVs) has sparked a surge in demand for hybrid-electric vehicles (HEVs), said JATO, with 382,700 units registered between January and March – the highest number of quarterly registrations for the category since 2021.
HEV volumes were up 18% on the corresponding quarter in 2023, contrasting with year-on- year increases of 3.8% and 4.8% for EVs and the overall new car market respectively.
‘Consumers are familiar with hybrid vehicles; they’ve been in the market for more than two decades now,’ said Munoz.
‘For many drivers, they are now the best option: cheaper than EVs at point of purchase and not reliant on public charging infrastructure that simply isn’t there in many markets.’
China’s OEMs lost market share in March, said JATO.
Last month, registrations of cars manufactured by Chinese car brands totalled 33,000 units including MG – an increase of just 0.7% on March 2023 – with electric models accounting for 36% of the total.
In March 2024, electric cars produced by Chinese brands comprised 6.1% of total BEV registrations.
According to Munoz, the drop in overall car registrations in March translated to fewer sales for legacy firms and Chinese OEMs.
‘China’s OEMs have not been immune to the worsening situation in Europe’s new car market. In addition to this, they may also be feeling the impact of increased negative scrutiny brought on by the European Commission’s investigation into Chinese EV imports.’
MG accounted for more than half (61%) of Chinese EV registrations in March, followed by BYD (24%) and Great Wall (5%).
Tesla led the ranking for BEVs in Europe with 39,000 units registered in March. However, this was 36% down on March 2023, while Tesla’s share of the BEV market dropped from 27.8% in March 2023 to 19.9% last month.
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The post Hybrid sales surge in Europe during Q1 as demand for EVs suffers a wobble appeared first on Car Dealer Magazine.
