The latest data collected by JATO Dynamics reveals some fascinating trends in the European new car market. In April of this year, the demand for pure electric cars reached a significant milestone, capturing a market share of 22%. This figure is only topped by the 25% market share recorded in December 2022. It is remarkable to note that more than one in every five new cars registered in Europe is now electric.
A key driver behind this surge in electric vehicle adoption is Tesla. Despite having a limited and somewhat outdated range, the American brand is successfully capitalizing on the growing consumer interest in electric driving. In August 2023, Tesla registered a staggering 33,809 cars in Europe, representing a remarkable 240% increase compared to the same month last year. As a result, Tesla has outperformed major mainstream European brands like Opel, Citroën, and Fiat, and is mere 3,600 units behind Ford.
Tesla’s success can be attributed to its popular models – the Model Y and Model 3. The former continues to dominate as the best-selling model in Europe and is likely to maintain this position until the end of the year. This situation exposes an interesting dilemma for the European car market, with a foreign brand surpassing all locally-produced vehicles in popularity. The Model Y has already surpassed 169,000 units sold, representing a remarkable 216% increase.
In the case of the Model 3, Tesla has strategically implemented price cuts to attract a broader customer base and entice buyers from other segments, such as the C-segment. With an updated version in the pipeline, further growth is expected for the Model 3. In terms of market share growth, Tesla, along with Geely and SAIC from China, stands out as the only companies consistently gaining market share over the years. Tesla’s success can be attributed to a series of well-timed actions, including the gradual introduction of the Model 3, the expansion of sales points across Europe, and the introduction of the Model Y. To maintain its growth momentum, Tesla has also implemented price cuts effectively.
Another noteworthy player in the transition from traditional gasoline/diesel-powered cars to electric vehicles is MG. Although positioned as a British brand, MG is entirely designed, developed, and produced in China. MG has emerged as a game-changer among Chinese automakers, with its latest offering, the MG 4, receiving positive reviews and appealing to consumers due to its competitive price. In August, MG secured a place in the European top 20, with nearly 14,900 units sold. This number surpasses the sales figures of brands like Suzuki, Mini, Mazda, and Jeep. Electric models accounted for 59% of MG’s sales volume, placing them seventh among the best-selling battery electric vehicle (BEV) brands. MG has surpassed prominent brands like Opel, Audi, Skoda, Peugeot, and Renault in terms of electric vehicle sales.
The outstanding success of Tesla and MG has come at the expense of reduced market share for traditional automakers. Brands like Volkswagen, Ford, Citroën, Peugeot, and Hyundai have witnessed the largest decrease in market share during recent months. While these brands do offer electric vehicles, they have struggled to compete with the appeal of Tesla and MG’s offerings. Traditional automakers face a significant challenge, as Tesla’s price cuts bring their models dangerously close to lower vehicle segments, while MG competes with highly competitive products from below.
In conclusion, the European new car market is witnessing compelling trends in electric vehicle adoption. Tesla has emerged as a dominant force, outperforming established European brands, while also disrupting traditional market segments. MG, a Chinese brand, has also made significant strides in the European market, establishing itself as a major player in the electric vehicle segment. These dynamics have resulted in reduced market share for traditional automakers, as they struggle to keep up with the competitive offerings and pricing strategies of Tesla and MG. The future of the European new car market is undoubtedly evolving, with electric vehicles taking center stage.