While new car registrations posted positive results for H1 2024, there are worrying signs of deceleration across the previous drivers of growth. JATO Dynamics’ data for 28 European countries revealed that new passenger car registrations increased by just 4.4% between January and June 2024, compared to the same period last year, with volume increasing from 6,559,213 units in H1 2023, to 6,847,842 units in H1 2024.
Felipe Munoz, Global Analyst at JATO Dynamics, said: “Europe’s growth is becoming more moderate – still far from levels seen pre-pandemic due to a more complex operating environment, including emissions regulations, increasing prices of vehicles, and barriers facing the adoption of electric cars. Since the semi-conductor shortage, electric vehicles have been the main driver of growth. It’s therefore vital that over the next 6 months, the industry does all it can to dispel uncertainty surrounding the EV market, including how EU tariffs on imported electric cars from China will impact the affordability of these vehicles.”
During the first half of 2024, registrations of electric cars from Chinese brands totalled 70,000 units. This marks an increase of 26% when compared to H1 2023. Similarly, their market share for BEVs also jumped from 5.97% to 7.37% over the same period. Among all car groups, this was the third largest increase of market share, only outperformed by Volvo-Polestar (+2.9 points) and BMW Group (+2.2 points).
Felipe Munoz, Global Analyst at JATO Dynamics, noted: “Measures taken by the European Union to impose tariffs on BEV imports from China, target models that accounted for 17% of BEV registrations in Europe during H1 2024, excluding potential units imported by Tesla.”
The Volvo EX30, made in China, was the third most registered electric passenger car in Europe during H1 2024. The fourth most popular was the MG4 – also made in China. Munoz, continued: “It’s clear that China has significantly helped to drive growth in the market. Without these competitive prices coming from China, consumers will face higher prices, meaning we could see demand could fall over the next few months.”
BMW and Chinese OEMs race ahead
In H1 2024, the European BEV market was led by Volkswagen Group with 178,000 units. However, its volume was 14% lower than H1 2023, following a 24% drop posted by the Volkswagen brand, and a 55% drop by Porsche. While the Volkswagen ID.3 and ID.4 have been receiving updates, both are relatively old at nearly 5 and 4 years old, respectively, meaning it has been difficult for the German OEM to gain attention among new potential customers.
In contrast, BMW Group and Chinese OEMs gained significant traction during the first half of 2024. BMW Group secured almost 10% share within the BEV market, up from 7.5% in H1 2023. This comes thanks to strong results of its BMW iX1; i4; the introduction of the i5 (the top-selling electric large car); iX2; and the Mini Countryman. BMW as a brand, registered more electric cars during H1 2024 than the Volkswagen brand.
Chinese OEMs also did extremely well over the course of H1. Geely Group – the owner of Volvo, Polestar and Lotus – increased its BEV registrations by 52%, compared to H1 2023, outselling Hyundai-Kia, Mercedes, and Renault Group. This growth came thanks to strong results posted by the Volvo EX30 – Europe’s third best-selling electric.
BYD registered 17,000 electric cars – 14,000 more compared to H1 2023. In fact, BYD’s rapid growth allowed it to outsell Nissan, Smart, Toyota, Polestar, Citroen, Dacia, Ford, Mini, Porsche, and Mazda. As a result, BYD is now Europe’s 16th best-selling BEV brand – the second Chinese brand following MG, which held 8th place in the BEV ranking.
Xpeng registered 2,214 electric cars compared to 51 in H1 2023; Great Wall Motors doubled its volume to 2,123 units; ZEEKR secured 821 units compared to 0 in H1 2023; Hongqi increased its units to 366 units marking a 266% uplift; while Voyah secured 225 units, compared to 8 units in H1 2022.
Munoz, stated: “Sharp domestic competition is the driving force behind the extraordinary level of progress observed in China. However, the associated impacts of market saturation, oversupply, and a price war mean that for many, overseas expansion will be critical to fulfilling growth ambitions.” Between 2020 and 2023, Chinese brands increased the sale of their cars outside of the domestic market by 5.4 times. To find out more about the rise of Chinese OEMs and their global ambitions, read JATO’s latest paper.
Tesla’s deceleration
After years of continuous growth, Tesla is starting to show signs of deceleration. Its registrations in Europe fell from 185,200 units in H1 2023, to 161,600 units this year through June. Munoz, added: “This is very similar to what we have seen in the US and there are three reasons behind this. Firstly, we know that any brand cannot maintain growth with a limited product line that is starting to age. Secondly, increasing competition from other brands such as BMW, will undoubtedly impact its registrations, and finally, Tesla’s strategy of price cuts seen in 2023 no longer holds the same effect due to more and more Chinese OEMs offering competitively priced vehicles.”
Although its Model Y and Model 3 continued to lead the European BEV ranking, the former is no longer the region’s most popular model in the overall ranking – falling to the 8th position and posting the deepest drop from the first to the 73rd position in the overall ranking. 2024’s new facelifted Model 3 on the other hand is doing well, with a 37% increase, however its growth may be impacted due to European consumers not favouring sedans.
SOURCE: JATO Dynamics
