A Slow Start for the European Car Market in 2025

While the European car market ended 2023 on a slightly positive note, the beginning of the new year brought a moderate decline. In January, 831,201 new passenger cars were sold across the European Union, marking a 2.6% drop compared to the same period last year.

Decline in Fuel-Powered Vehicles, Strong Growth in EVs and Hybrids
Traditional internal combustion engine vehicles—including petrol, diesel, and plug-in hybrids—lost market share, while electric and hybrid cars continued their upward trend. Fully electric vehicle (EV) sales surged by 34%, while hybrids saw an 18.4% increase. As a result, EVs now account for 15% of total car sales in the European market.

Major Markets in Decline, While Spain and the Baltics Show Strength
The downturn was primarily driven by declines in Europe’s largest markets:

Germany: -2.8%
France: -6.2%
Italy: -5.8%
Among the five biggest EU car markets, only Spain managed to post positive growth, with a 5.3% increase in new car sales.

What Lies Ahead for the European Car Market?
Despite a weak start to the year, EVs and hybrids are expected to continue gaining market share, especially as governments maintain incentives for sustainable mobility. Economic factors such as interest rates and supply chain stability will also play a crucial role in shaping market trends.

By the end of Q1 2025, it will become clearer whether January’s downturn was a temporary setback or the beginning of a longer-lasting trend in the European automotive sector.