Electric Vehicles Overtake Petrol Cars for First Time in Europe

Sales of electric vehicles (EVs) surpassed those of petrol-only cars in the European Union for the first time in December 2025, marking a significant milestone in the automotive landscape. According to data from the European Automobile Manufacturers’ Association (ACEA), this shift reflects changing consumer preferences driven by both climate concerns and government incentives.

The transition to electric and hybrid vehicles is evident across the bloc, despite recent adjustments to the EU’s 2035 car emissions targets. The European Union announced a revised goal of a 90% reduction in carbon dioxide emissions from car manufacturers by that year, a change from the previous target of 100%. This revision also rescinded a controversial ban on internal combustion engine vehicles established in March 2023.

Market Dynamics and National Incentives

In 2025, hybrid electric cars, which combine batteries with gasoline engines, remained the dominant category in the market. The largest EV markets within the EU—Germany, the Netherlands, Belgium, and France—accounted for 62% of battery-electric car registrations. Notably, petrol car registrations fell by 18.7% across the bloc, with France experiencing the most significant decline at 32%. Other notable decreases included Germany at 21.6%, Italy at 18.2%, and Spain at 16%.

The decline in petrol and diesel vehicles primarily stems from varying national incentives and taxation policies that influence consumer choices. According to Eurostat, countries like Italy, Poland, and Greece offered substantial government subsidies for EV purchases last year. Italy, for instance, provided up to €11,000 per individual, covering approximately 30% of the purchase price for new electric cars, contingent upon income levels. Vehicles priced above €42,700 including VAT are excluded from this program.

Greece and Poland also offered significant incentives, with each providing around €9,000. Greece further incentivizes the shift by offering an additional €2,000 for scrapping older, polluting vehicles and €1,000 for purchasers under 29 years old. Tax incentives in Greece make battery electric vehicles (BEVs) exempt from registration tax, while the lowest-emitting vehicles avoid circulation tax.

The Broader Impact on the Automotive Industry

The automotive sector plays a crucial role in the EU economy, contributing over 8% of the bloc’s Gross Domestic Product (GDP) and generating 8.1% of all manufacturing jobs. Approximately 13.6 million Europeans are employed in this industry, underscoring its significance in providing livelihoods and driving economic growth.

As the EU navigates this shift towards sustainable transportation, the implications for traditional car manufacturers and new entrants alike are profound. The changing landscape not only reflects evolving consumer preferences but also highlights the urgent need for industries to adapt to regulatory changes aimed at reducing emissions and promoting cleaner technologies.

The growth of the electric vehicle market is set to continue, driven by both consumer demand and supportive government policies across Europe. As the automotive sector transitions towards greener alternatives, the landscape of personal transportation in Europe is likely to undergo further transformation in the years to come.