Stromer in the fast lane?
Electric cars conquer the mass market
8/4/2023 2:23 p.m
Electric cars are becoming increasingly popular and have reached mainstream buyers. Some manufacturers also offer significant price reductions. But the tide could turn again soon.
Every fifth new car sold in Germany last month had a battery-electric drive. With almost 48,700 pure electric cars (BEV), around 60 percent more vehicles came onto the road in July than in the same month last year, as reported by the Federal Motor Transport Authority (KBA). Their share of all new registrations was therefore 20 percent.
“After the weak start to the year, the growth momentum in electric cars continues to increase,” said Constantin Gall, Managing Partner at the consulting firm EY. According to a study by the management consultancy PwC Strategy&, the Stromer are now on the threshold of the mass market.
Mainstream buyers are grabbing it
This means that “normal market conditions now also prevail in the electronics segment, with everything that goes with it,” said PwC industry expert Felix Kuhnert. “The early adopters and buyers with conviction have stocked up. Now the mainstream buyers are grabbing it, but they apply tougher criteria in terms of product and price.”
In the meantime, manufacturers are fighting for market share in electric vehicles, in particular in the higher-priced segment, with some significant price reductions. According to a study, the average discount for electric vehicles in the premium segment rose by a quarter to 14 percent from June to July.
In the middle segment, the average discount rose by a third to 11 percent. “Only in the volume market, where the highest government purchase premiums continue to lure, have the discounts remained largely the same” at 9 to 10 percent, PwC said. “In the fight for market share, car manufacturers are fighting a BEV discount battle that is now reaching Europe,” explained the industry experts.
Purchasing an e-car is becoming more expensive
After corona lockdowns and delivery bottlenecks had caused a shortage of supply and high prices for a long time, car production is picking up again. The data “shows that car manufacturers in the German market are increasingly opting for discounts and are also granting them for BEVs”.
However, there is also skepticism as to whether the current high demand for electric cars will last for long. “Because for companies, the purchase of an electric car will become significantly less attractive when the state subsidy expires on September 1st,” said EY expert Gall. Commercial owners make up the majority of new registrations at 68 percent.
Despite the increasing number of e-cars, the average CO2 emissions of all newly registered cars have not decreased. In the first six months of this year, the CO2 emissions of newly registered vehicles averaged 121 grams per kilometer and were therefore roughly the same as in the same period last year. The reason: In particular, new registrations with average emissions between 121 and 160 grams per kilometer increased by almost a quarter in the first half of the year. The number of new vehicles emitting less than 50 grams of CO2 per kilometer fell by 1.7 percent over the same period. KBA data for July are not yet available.
Overall, the car market grew significantly in July, but remained below pre-pandemic levels. According to the KBA, 243,277 new cars hit the roads in July. That was around 18 percent more than in the same month last year. But: “Compared to the first seven months of 2019, new registrations are 25 percent lower,” said the Association of the Automotive Industry (VDA).