Transition to electric vehicles now ‘inevitable’ in UK and much of Europe thanks to declining upfront costs, major new study finds

Electric vehicles (EVs) are set to become the most in-demand option for drivers across Europe within the next three years, with a rapid shift to electric mobility on roads now inevitable over the coming decade and beyond, a major new study of seven national auto markets has concluded.

Thanks to declining upfront EV costs, a widening range of available plug-in models, tighter CO2 standards, and increasingly demanding deadlines for phasing out the sale of new fossil fuel vehicles across Europe, the shift away from petrol and diesel is poised to rapidly accelerate, according to the analysis from the Platform for Electromobility.

A new study today commissioned by the industry alliance – which counts more than 45 producers, operators, transport users, and civil society organisations as members – assesses the rate of EV take-up, market conditions, and regulatory landscapes Europe’s largest auto markets: the UK, France, the Netherlands, Italy, Spain, Germany, and Poland.

The research, which was carried out by consultancy Element Energy and drew on a survey of 14,000 new car buyers across Europe, identified upfront cost as the most important factor influencing consumer purchase decisions for road vehicles.

As such, it said that once EVs achieve price-tag parity with petrol and diesel vehicles, drivers would rapidly switch towards electric mobility, leaving the electric car market poised for exponential growth in the coming years.

Under a scenario where price parity between the upfront cost of pure-EVs and new fossil fuel vehicles is achieved in 2028, the study estimates EVs would achieve a more than 50 per cent market share and surpass petrol and diesel cars as the most in-demand option for consumers as early as 2025. By 2035, almost all car sales will be electric, according to the study. The analysis also notes that price parity could be achieved sooner than 2028.

Amélie Pans, chair of the Platform for Electromobility, said the research showed the shift to EVs was “happening faster than industry and legislators expected”.

“We all need to respond appropriately to ensure we meet the demands of consumers,” she said. “It is our common responsibility to ensure that everyone in Europe, wherever they live, can switch to electric vehicles as early as they want.”

EV sales in the UK and much of Europe have surged during the pandemic, posting record growth in 2021 even as the wider car market struggled. EV sales in the UK are now expected to double in 2022, on the back of the record year experienced in 2021. The surge in demand has left automotive firms scrambling to widen their battery car offering and increase their manufacturing targets to meet demand. But it has also raised concerns over the availability of supporting infrastructure, with commentators warning that without a rapid expansion in the number of charge points growing demand for EVs could stall in the coming years.

Studies have shown EVs are often already cheaper to run than petrol and diesel cars thanks to lower maintenance and fuel costs, but the upfront price tag remains a barrier for many interested battery car drivers, and electric car sales despite rapid growth currently still stand at only a fraction of those for fossil fuel cars in most European markets.

But with costs of batteries and other key components for manufacturing EVs predicted to continue plummeting in the coming years, price parity between battery and fossil fuel cars is expected around the mid-2020s.

Meanwhile, targets for phasing out fossil fuel cars in the 2030s continue to emerge across Europe and beyond, which, in addition to tightening CO2 emissions standards for new petrol and diesel cars, is expected to further bolster the growing market for EVs.

However, the study also warns that there remains “a long way to go” before demand for EVs forces fossil fuel vehicles off the road in large numbers, and that while charge point availability is not generally seen by drivers as a barrier to buying an EV, the rollout of such infrastructure needs to keep pace with EV demand or the switch to electromobility risks being undermined.

Pans said ambitious new regulations alongside strong investment in charge point infrastructure would help to accelerate the shift towards EVs. “Ensuring a strong charging network with easy access to public and private charge points is key to ensure everyone benefits from electromobility,” she said.

While the study paints a positive outlook for EVs, the picture for e-fuels such as hydrogen is far less rosy for the European car market. The research suggests consumers are likely to reject cars running on e-fuels in favour of EVs, in part due to higher running costs associated with alternative fuel vehicles.

“We see in this report that e-fuels do not benefit consumers and they don’t want it,” Pans said. “Governments should instead focus investment towards achieving the near-term purchase price parity of mass-market electric vehicles.”

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