Hyper-competition from new-entrants continues to batter established car makers across Europe
- Matthias Schmidt
- 7 hours ago
- 2 min read
Established OEMs present on the Western European new passenger car market are being prevented from seeing annual new registrations surpass 11 million, as intense hyper-competition from new market entrants (NMEs), predominantly from China and the US, with a regional presence of less than 15 years, are creaming off a very slow-recovering market. That means 3 million fewer models continue to be delivered by established brands compared to pre-Covid levels.
- New Market Entrants accounted for a record 8.2% share of the regional new car market during 2025, increasing by 2.1 percentage points over 12 months earlier and seeing volumes almost double with Chinese OEMs offsetting volume falls from Tesla.
- Established OEMs have been stuck in a 10 - 11 million corridor for 5 out of the last six years, with 2022 witnessing that level dip below 10 million as the Covid-hit region was impacted further by the semiconductor and wire-harness impact.
- Over-capacity still needs to be addressed, with New Market Entrants largely favouring greenfield investments, leaving legacy production plants heavily underutilised. Renault Group has partially addressed this by redeveloping established sites, such as Flins, into recycling facilities, in preparation for EU regulations that will dictate this going forward.
- Mass-market brands such as Stellantis' Opel/Vauxhall are seeing annual volumes operating at half the level they were prior to Covid.
- Toyota Motor Europe is an outlier, seeing volumes improve by 9% since pre-COVID levels. Renault Group's Dacia also saw volumes increase by 9% during the same period, gaining 1ppt market share to 4.2%, while Škoda witnessed 2025 volumes gain by 15% over 2019, bringing its market share to above 5% for the first time during 2025 and ending the year above stable-brand Audi. While new market entrants, predominantly from China, and former budget brands such as Dacia and Škoda, which have improved their market image and are now seen as a good alternative to traditional mass-market brands, premium OEMs make up a third of a stable foundation across the market.
Premium OEMs maintained stable market share, holding between 20% and 22% in pre-COVID years and continuing to do so today, demonstrating stability amid a turbulent market environment. Stable residuals are likely helping premiums in a fleet-driven, heavily financed new-car market.
*Western Europe 18 Markets: EU Member States prior to the 2004 enlargement plus EFTA markets Norway, Switzerland, Iceland, plus UK
Comments