How to re-energise Europe’s BEV market

The sluggish uptake of electric vehicles in Europe is front and centre of OEM agendas in the face of regulatory pressures and the climate emergency.

Across the EU, battery-powered models accounted for a 15.6% share of the new car market in H1 2025, up from 12.5% a year earlier, but not a trajectory that suggests the motor industry will be able to phase out the sale of new petrol and diesel models from 2035.

BEVS performed well in Germany (+35.1%), Belgium (+19.5%), and the Netherlands (+6.1%), but sales fell -6.4% in France.

Manufacturers have called for co-ordinated strategies driven by tax incentives and charging infrastructure investment to accelerate the adoption of BEVs, with a particular focus on the corporate sector, which is responsible for 60% of EU car registrations.

This carrot-not-stick approach has helped Norway and Belgium trailblaze to a position where more than 90% and 80% respectively of new company cars are zero emission. Yet only 19 EU member states currently have dedicated tax incentives schemes to green corporate fleets at a time when the European Commission is considering a zero emission vehicle mandate for large businesses.

The decarbonisation of light commercial vehicles is even further off track, accounting for fewer than 10% of registrations in H1 2025.

As bellwethers of the economy, the 13.2% year-on-year decline in new van registrations in the first half of 2025, and the 15.4% fall in truck sales present a concerning outlook for Europe’s automotive and finance sector.

The mid-year point saw a flurry of financial results, with mixed performances. Stellantis celebrated selling more than 1.3 million vehicles to cement its position as the second largest OEM in Europe, but also announced net revenues fell by 13% year on-year in H1 2025, leading to a net loss of €2.3 billion, down from a profit of €5.6 billion in the same period last year.

There were more positive figures from Volkswagen Group Mobility, which reported a sharp rise in earnings and contract volumes for the first half of 2025. The division posted an operating result up 31.9% on the same period last year (which had been weighed down by currency effects linked to the exit from Russian operations), and a 5.3% increase in new contracts. Its insurance (up 19%) and leasing (up 10.2%) portfolios were the strongest performers.

A 30% surge in its Drivalia rental and mobility business saw CA Auto Bank close the first six months of 2025 with strong results, although its financing and leasing activities saw a 6% decline.

Leasing giant Ayvens boosted its net income group share by 38.5% year-on-year to €271 million, while Return on Tangible Equity increased to 13.7%, but its fleet size shrank slightly. The company continues to integrate former LeasePlan and ALD operations, with the latest merger completed in Romania.