Wind of Change – A growing number of OEMs appear content with likely stricter EU CO2 fleet targets
February marked a perhaps historical turning point in the European passenger car market. The European automotive mouthpiece, ACEA – representing European passenger car manufacturers – appeared to fall into line with new European Commission Green Deal proposals to be discussed this summer. The discussions are centred around an increase in CO2 fleet average emissions targets in 2030. A realistic consensus agreement is likely to be a 12.5 percentage point increase over the current 37.5 per cent reduction target by 2030. This would result in a new target, set to see fleet CO2 targets half over current 2021 levels to around 60g/km (WLTP) by 2030.
With manufacturers presenting their full-year financial results during March, mostly with increased forward-looking BEV targets, some such as the Volkswagen brand – who plan on doubling their European BEV sales mix forecast in 2030 from 35% to 70% – clearly cited the Green Deal as a key driver.
BMW Group CEO Zipse, also the current ACEA president, said as part of the BMW Group investor call, that if need be, the Munich- based manufacturer will be capable of meeting electric demand if the market calls for it, while indicating that the group's MINI brand will transform to a BEV only brand from the start of the 2030s.
With Ford of Europe also announcing similar commitments and Jaguar phasing-out ICEs from 2025 this edition of the report is now confident of presenting a 2030 market outlook (pages 6-7).
The Green Deal and Alternative Fuels Infrastructure Directive talks – aimed at increasing the roll out of charging infrastructure – will have a major impact on the future market.
In terms of market developments, the European market is increasingly becoming dependent on the German market.
The West European region would have seen a 1.2% decline in new BEV registrations during the opening two months of the year without Germany, while with the auto nation added, that now accounts for twice as many registrations as the next largest market France, the market increased by 23.7 per cent y/y.
The German market is largely being propped up thanks to the generous government/OEM joint purchase subsidies with a €9,000 maximum available, helping lower lease rates, while fiscal benefits for company car drivers are also leading to German PHEV volumes accounting for one-third of the West European PHEV total, or nine percentage points higher than its share (23.9%) of the total West European passenger car market.
At the same time the UK government cut the purchase premium for BEVs in a dramatic unscheduled announcement with immediate effect by £500 to £2,500, and more significantly lowering the upper-cap from £50,000 to £35,000 (affecting Tesla).
This could impact OEMs hoping to meet UK CO2 fleet targets in 2021, which mirror EU targets.
Key points:
Germany dominates Europe's BEV electric car market. No.1 EU market in terms of national BEV mix YTD (9.5%). Norway (non-EU) remains above half, at 50.2%. West European BEV market growth would have been negative in 2021 without Germany.
No.1 Group: VW Group accounts for 1-in-4 West European BEV volumes Jan-Feb 2021
No.1 brand: BMW in terms of both new xEVs and PHEVs volumes Jan-Feb 2021
BMW and Mercedes brands see xEVs account for 1-in-4 of their YTD volumes as premiums show the highest xEV mixes in a top-down electrification trend.
12-month xEV rolling total just short of 1.5 million units (2020 full year: 1.33m).
2030 forecast sees BEV share of market same as diesel market in 2015 dieselgate year.
This is just a summary of the European Electric Car Sales Monthly Market Intelligence Report which is published on a monthly basis and are available here. *Western Europe 18 Markets: EU Member States prior to the 2004 enlargement plus EFTA markets Norway, Switzerland, Iceland, plus UK