Electric car sales growth loses power in Europe

Sales growth of electric and plug-in hybrid cars has dimmed across the European Union’s major markets during the first half of this year because of limited driving ranges and a patchy charging network.

Registrations of electric cars rose 33 per cent in the six months through June, compared to a 54 per cent surge a year earlier, consultancy EY said on Tuesday. Strong demand in Germany, the EU’s biggest car market, wasn’t enough to offset meeker growth in the UK, the second largest.

“Electric cars remain a niche product for now,” EY partner Peter Fuss said. “Charging infrastructure remains inadequate and the models currently available mostly don’t offer a good enough range.”

Car makers in Europe are under pressure to meet tough new EU rules on lowering fleet carbon dioxide emissions that will be phased in during 2020.

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Consumers staying on the fence on electric cars, and favouring petrol cars over diesel engines, raises the stakes for manufacturers like Mercedes-Benz maker Daimler and Fiat Chrysler Automobiles who risk steep fines if they exceed the new ceiling. Diesel cars emitting about a fifth less CO2 than equivalent petrol vehicles.

Demand for diesel has slumped in the EU’s biggest automotive markets during the first half of the year as buyers worry about driving bans in cities, three years on from Volkswagen’s emissions cheating. At the same time, sales of petrol cars have jumped 16 per cent.

Car makers including BMW, Daimler and Volkswagen will unveil a range of new electric products in the coming years, such as the BMW iX3 sport utility vehicle and VW’s I.D. mass-market range, a standalone battery lineup.

“The situation will only change in the medium-term,” said Mr Fuss. “Starting in the luxury segment, electric powertrains will establish themselves as serious alternatives.”