Europe‘s EV Market Rebounds as US Subsidies End
Europe is becoming a key battleground for electric vehicles, while the United States is set to end its electric vehicle purchase subsidies at the end of next month. This shift comes as European governments signal a renewed commitment to expanding the EV market through continued financial incentives.
Hyundai Motor Group is accelerating its efforts in the european electric vehicle market with an expanding EV lineup.
According to a recent report from the US-based National Bureau of Economic Research (NBER), the end of US EV tax credits, scheduled for September, could lead to a sales decrease of up to 37% for EV manufacturers, including Hyundai.
The change, a revision to the Inflation Reduction Act originally promoted by the Biden Governance, is happening seven years ahead of schedule. Starting October 1st, consumers will no longer be eligible for the up to $7,500 tax credit when purchasing an electric vehicle.
Cox Automotive, a US market research firm, predicts a important contraction in the EV market during the fourth quarter due to the subsidy expiration. This year, the share of electric vehicle sales in the US has already fallen from 10% to 8.5%, a decrease of 0.4 percentage points from the previous year.
In contrast,Europe’s electric car market is experiencing a resurgence. According to market research firm Zato Dynamics, new car sales in Europe during the first half of the year totaled 684,426 units, a slight decrease of 0.3% year-over-year. However, electric vehicle sales (119,397 units) increased by 25% over the same period, marking the first time European EV sales have exceeded 1 million units in the first half of a year.
The European Union’s increasingly stringent carbon emission regulations are driving the adoption of electric vehicles, and the influx of Chinese EV manufacturers into the European market is also growing. Furthermore, with europe strengthening its EV benefits, demand for electric cars is expected to increase in the second half of the year.
The UK currently offers support of up to 10% on the purchase of new electric vehicles priced under £37,000, while Germany allows companies to deduct up to 75% of the cost of electric vehicles purchased.