The car manufacturers are pushing electric cars in 2020, the picture is the electric SUV ID.4 launched by Fuchs Automobile.
Europe has surpassed China to become the world’s largest electric car market, because the authorities offered car purchase subsidies, and various car manufacturers also launched dozens of electric cars and hybrid cars, prompting the European public to buy electric cars. But analysts warn that if the government no longer provides subsidies, electric car sales may collapse.
The Wall Street Journal reported that according to ev-volumes.com data, Europe’s plug-in electric vehicle sales surged 137% to 1.4 million units last year, surpassing the mainland’s 1.3 million units and the U.S.’s 328,000 units; the share of European electric vehicle sales in the global market nearly doubled last year to 43%, while the mainland’s share dropped from 59% to 41% and the U.S. only 10%.
However, the surge in European EV sales was mainly due to government incentives for car purchases during the raging Epidemic, so analysts warned that sales momentum could turn weak once the incentives are removed. Most European government subsidies for electric vehicles are limited and scheduled to expire at the end of this year.
Bernstein Research automotive analyst Arndt Ellinghorst said the electric car market is very sensitive to government incentives and dealer discounts, “once the subsidy factor is removed, electric car sales will collapse by 30 to 40 percent in at least one to two quarters.
If the government does not subsidize, electric cars are still more expensive than the same class of fuel models. Analysts say this situation may not change until around 2030, when the price of electric car batteries will decline because of the emergence of new technologies, production scale expansion and market competition.
Europe to promote the development of electric vehicles, the beginning of the more dependent on the “stick”, rather than “carrot”. The EU has gradually tightened controls on emissions, forcing the auto industry to launch more electric or gasoline vehicles or face huge fines.
When the new pneumonia epidemic hit, European governments began to provide subsidies to frontline industries fighting climate change to soften the economic impact. Most of the grant money went to incentives for electric vehicle purchases, leading to a surge in demand.
This also changed the view of auto industry leaders; they originally believed that the electric vehicle market was not large enough to provide sufficient incentives for investment. So the auto industry started to launch electric vehicles in a big way last year, Fuchs Auto has released ID.3, ID.4 and other electric vehicles; BMW, Mercedes-Benz, Audi and other luxury car manufacturers have also launched high-end electric vehicles.
Last year, Europe published about 65 models of electric vehicles, more than double than China, and this year Europe is expected to launch 99 models of electric vehicles; in contrast, North America only published 15 models of electric vehicles last year, and this year is expected to 64 models.
However, car manufacturers are still concerned that government subsidies will only bring short-term effects, and without extensive structural reform, the electric vehicle market will be difficult to develop soundly. Car manufacturers believe that the government should focus more on promoting infrastructure such as charging stations, supporting the construction of battery factories, and imposing a carbon tax.
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