VW’S EV sales fall as Europe turns back to petrol cars
Demand for Volkswagen electric cars plunges by 24pc while Mercedes-benz suffers similar decline
SALES of Volkswagen electric cars have plunged by almost a quarter in Europe as demand for battery-powered vehicles stalls and buyers return to petrol.
Electric vehicle (EV) sales fell by 24pc in the first three months of the year as high inflation and rising energy prices dampened demand.
Globally, all-electric sales at the owner of Audi, Skoda and Porsche dropped by 3pc to 136,400, while sales of combustion engine cars climbed 4pc to nearly 2m.
Mercedes-benz yesterday also reported an 8pc drop in EV sales, blaming “the abrupt end of a tax incentive” in Germany and the phasing out of a popular electric model from its brand Smart. The sales slump is the latest signal that drivers are becoming more reluctant to adopt EVS.
Yesterday, the boss of Aston Martin claimed slowing demand for EVS underlined why it was “premature” for governments to compel their sale through legislation. Lawrence Stroll, the billionaire owner of the sports carmaker, claimed the push towards EVS was more about “hype” than real consumer demand currently.
He added: “Obviously, [legislation] was premature. We don’t have the charging abilities put in place to deliver the initial time expectations, nor the demand. So you know, politically, you cannot drive consumer demand. Let me put it like that. Consumer demand will be what consumer demand is, and that does not necessarily – as proven in this – follow legislation.”
Several companies have been adjusting their EV plans in the face of weaker consumer demand.
Stellantis, the car giant that owns Peugeot, Vauxhall and Maserati among others, yesterday said it would extend production of its petrol-powered Fiat Panda until 2030. The manufacturer had planned to switch its best-selling city car to all-electric by 2027. Manufacturers have warned that legal deadlines to phase out petrol and diesel cars risk being unfeasible without a relaxation of the current rules.
In September, Rishi Sunak pushed back a deadline to block new petrol and diesel sales in the UK from 2030 to 2035. Incentives for drivers buying new EVS were scrapped in 2022.
Data suggest that demand for petrol cars is rising faster than for electric models in Britain.
EV registrations were only 3.8pc higher last month than they were a year earlier, according to figures released last week by the Society of Motor Manufacturers and Traders, while petrol-engine sales rose 9.2pc.
Volkswagen sells some of the UK’S most popular electric vehicle models, including the Audi e-tron range and Volkswagen ID.
Officials in the EU, meanwhile, have been considering watering down a similar ban on petrol and diesel cars in the bloc to allow the use of synthetic fuels – so-called e-fuels – that can power a combustion engine.
Matthias Schmidt, founder of Schmidt Automotive Research, said Volkswagen had been affected by the axing of subsidies for EV sales in Germany. The EU has also frozen emissions targets for vehicle fleets, stunting sales.
Volkswagen and Mercedes-benz’s EV sales are coming under pressure as European carmakers face growing competition from an influx of new Chinese-made electric cars. Brands such as BYD offer battery-powered cars that are cheaper than Western rivals.
The EU has launched an investigation into the subsidies being offered to Chinese carmakers by Beijing. Experts at Germany’s Kiel Institute estimate that BYD alone has received more than €3.4bn (£2.9bn) in Chinese subsidies in recent years, Bloomberg reported. BYD was contacted for comment. The drop in Volkswagen sales follows a sharp fall in deliveries at Tesla, the West’s leading electric vehicle maker. Last week, Elon Musk’s business reported an 8pc fall in sales during the March quarter.
However, not all companies are struggling. BMW said yesterday that its EV sales rose by 28pc in the three months to March. Deliveries of its battery-powered models such as the i4, ix1 and i7 jumped 41pc during the period.