The builders face the reality of the market
Disruptions in the electric car sector
The manufacturers are in turmoil. Despite their considerable investments in all-electric, sales are not progressing as quickly as hoped, resulting in lower revenues.
The environmental standards imposed by the European Union add additional pressure. Some manufacturers are already sounding the alarm and considering a step back. They had announced high ambitions, such as the exclusive sale of electric vehicles by 2026 or 2030.
However, the targets now seem utopian, especially with the approaching ban on sales of new combustion and hybrid cars in 2035 within the European Union. A review clause is planned for 2026, but it is unlikely that this will lead to significant changes.
Environmental goals and economic realities
To achieve Europe’s environmental goals, the transition to electric is inevitable.
From January 2025, a reduction of CO2 emissions to 81g/km will be required, with a target of 50g/km in 2030. Manufacturers, therefore, need to increase the share of electric vehicle sales to avoid heavy fines based on average CO2 emissions. The financial risk is high, with potential penalties of billions of euros.
The challenge of electric vehicle sales
Despite their efforts, electric vehicle sales do not meet expectations. The price remains a major obstacle, and subsidies are gradually declining. For example, in Germany, they have disappeared. In France, they are now limited to moderately priced European models. Analysts estimate that about 25% of vehicle sales will need to be electric to avoid fines in 2025, a distant goal for many manufacturers like Renault and Peugeot.
Strategies of major European manufacturers
Volkswagen Group is taking drastic measures. The company has delayed the arrival of more affordable electric models and suspended production of certain models. Audi, on the other hand, continues to announce a 100% electric range by 2033, while admitting that demand will mainly be for plug-in hybrids during the transition. Porsche also anticipates a slower transition to electric.
French manufacturers’ strategies
Renault and Stellantis are betting on cost reduction. Luca De Meo, CEO of Renault, insists that to democratize the electric car, prices must fall. Renault is thus adjusting its strategy until 2026 while maintaining that the European industry should not change course abruptly. At Stellantis, Carlos Tavares shares a similar vision, with increased flexibility thanks to multi-energy platforms.
Situation in the United States and China
In the United States, the situation is not much better. General Motors will probably admit not reaching its electric vehicle production targets for 2025. Ford has also revised its forecasts in Europe, deciding to extend the sale of combustion models as long as the regulations allow.
In contrast, China continues to dominate the electric market. In 2023, 69% of electric vehicles sold globally were sold in China. Electric vehicles are more affordable there, often cheaper than their combustion counterparts, thanks to a generous subsidy policy from the Chinese government.
Conclusion
Despite the difficulties encountered, the transition to zero-emission mobility continues to advance. Manufacturers are adjusting their strategies to adapt to market realities, with sometimes complex maneuvers to align their economic goals with environmental requirements. The path to electric will be long and fraught with obstacles, but it is inevitable.