European EV Sales Experience Fluctuations as Ford Launches Electric Capri Production in Germany

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Recently, my colleague Jose Pontes highlighted some challenges facing electric vehicle (EV) sales in Europe. However, these challenges are not consistent across all countries. Traditional car sales are also experiencing a downturn. The Center for Automotive Management (CAM) in Germany has created a chart that provides a clear snapshot of the EV sales landscape across European nations, revealing some positive trends amidst the overall decline.

From January 1 to August 31, 2024, Europe recorded 1,213,262 new EV sales, CAM Director Stefan Bratzel reported, down from 1,283,776 during the same period in 2023. CAM compiles data for EU countries and the four EFTA nations — Iceland, Liechtenstein, Norway, and Switzerland. This distinction is crucial as the EFTA markets contribute to manufacturers’ carbon dioxide fleet limits, unlike the UK, which has its independent CO2 regulations post-Brexit.

Bratzel noted “significant shifts in the European market.” Although overall EV sales have dropped considerably in Germany, they are increasing in several other countries. “Total BEV registrations across the EU, EFTA, and the UK decreased by 5.5% compared to the prior year, but key markets are showing contrasting trends,” he observed.

In the first eight months of 2024, Germany, the largest car market in Europe, saw a staggering 32% decline in new EV sales. This decrease can partly be attributed to a spike in sales the previous year as buyers rushed to benefit from a German environmental bonus subsidy for commercial owners before its expiration. In December 2023, Germany further impacted the market by abruptly terminating the environmental bonus for all EVs, leading to a drop from 355,575 new EV registrations in the first eight months of 2023 to just 241,911 this year.

Conversely, the United Kingdom reported a robust growth of 10.5%, achieving 213,544 EV registrations. This upward trend means the UK is fast narrowing the gap with Germany and may soon lead the European market, as Bratzel noted. Should Germany’s situation not improve soon, the UK could surpass it as Europe’s top market for electric cars. France, currently in third with 188,575 new EV registrations, is also gaining ground. It is expected that manufacturers across Europe will soon intensify their EV initiatives to adhere to EU emissions regulations. The recent price drop for the VW ID.3 serves as a practical example of this shift.

Interestingly, Belgium has now secured the fourth spot, surpassing Sweden with a 41.3% increase, totaling 84,137 electric vehicles sold — an “impressive increase,” according to Bratzel. Among the top ten countries, Denmark experienced the highest growth at 50.8%, with 51,945 new EV registrations compared to 34,440 from the previous year.

Denmark now sits just behind Sweden, which recorded 54,304 new EV sales this year. However, like Germany, Sweden has modified its EV subsidy policy, resulting in a 21% reduction in new EV sales from last year. Italy rounds out the top ten with 35,785 EV sales — a decline of 12.3% — while Spain saw a slight increase of 2.5% with 31,665 EV registrations.

The crucial question now is how the landscape will evolve in the upcoming months. Automakers will be focused on meeting the carbon dioxide fleet targets established by the European Union. Bratzel suggests that EV sales in the coming year will likely be comparable to this year’s figures. Peter Mock, head of the International Council on Clean Transportation, indicated in an interview with electrive that he predicts EV sales in Europe will stabilize around “25 percent battery vehicles” — potentially slightly lower or higher — “and this trend will likely remain steady until 2029.” While some experts might consider Mock’s medium-term forecast overly cautious, it reflects a growing consensus that realities often differ from expectations.

Ford Starts Capri EV Production

Amid declining sales of its ID. line of electric vehicles and traditional cars, some may assume that other automakers are scaling back their electric production efforts. However, Ford has commenced production of its new Capri battery electric vehicles at its factory in Köln (Cologne), Germany. This Cologne EV Center is on track to become Ford’s first carbon-neutral assembly plant worldwide, aligning with the company’s goal of achieving carbon neutrality throughout its European operations by 2035.

The Capri nameplate pays tribute to a vehicle of the same name that was popular in the US 50 years ago. Previously equipped with a V-6 engine and a 4-speed transmission, it was often referred to as the “poor man’s XK-E” among sports car enthusiasts. The new Capri EV embraces some design elements reminiscent of its predecessor, though today’s version is reimagined as a four-door vehicle with SUV characteristics, unlike the original two-door coupe.

Initially, Ford aimed to transition entirely to electric vehicles by the turn of the century, but has since revised its plans in response to market conditions. Recently, Marin Gjaja, CEO of Ford’s Model E electric car division, indicated to Autocar that the company’s intentions to go fully electric by 2030 in Europe were “too ambitious.” Ford will continue to sell combustion engine cars in Europe beyond the previously stated six-year timeline due to the “uncertainty” surrounding EV demand and regulations. The company plans to offer hybrid options in its Puma, Focus, and Kuga models.

“I don’t believe we can commit entirely to anything until our customers fully embrace it, which is happening at varying speeds across the globe,” he stated. “I think customers have expressed their view, and they’ve made it clear that our original timeline was overly optimistic. The industry has collectively learned this lesson. Reality has a way of forcing us to adjust our plans. We believe that going entirely electric by 2030 is not the best strategy for our business or our customers,” he added.

The new Capri will mark the second EV produced at the Cologne EV Center, which is also home to the newly launched Europe-only Explorer. Both vehicles utilize the Volkswagen MEB platform, playing an essential role in Ford’s future strategy. Works Council Chairman Benjamin Gruschka recently described this development as a significant milestone for the Cologne plant and its workforce during these challenging industry times.

The Takeaway

Five years ago, many were captivated by Elon Musk’s vision of Tesla doubling its production capacity annually and producing 20 million electric vehicles per year by 2030. Since then, Tesla has significantly reduced its projections, while the rest of the industry has realized that there is often a disparity between theoretical ambitions and actual outcomes. Despite challenges in Germany, EV sales across Europe appear to be on a steady growth trajectory, albeit at a slower pace than initially anticipated.

The current downturn in the electric vehicle market can largely be attributed to abrupt changes in government policies that have left consumers confused. Stability is critical for markets, yet government interventions often lead to volatility until a new balance is established. The best mantra for EV proponents during this time may be, “Keep calm and charge on.” The electric vehicle revolution is still in its early stages.