German electric car market 2023: VDA expects decline
Discontinuatrion of subsidies for plug-in hybrids is slowing down the e-market - One-digit growth expected for purely battery-electric passenger cars (BEV)
The German Association of the Automotive Industry (VDA) expects sales of purely battery-electric passenger cars (BEV) to increase by 8% to around 510,000 units in the current year. For plug-in hybrids, the VDA assumes that sales will drop significantly to around 255,000 units (-30% compared to 2022) due to the discontinuation of the subsidy at the end of 2022. As a result, the VDA expects total sales of electric cars (BEV and PHEV) to be around 765,000 units in 2023. This corresponds to a decrease of about 8% compared to the previous year. The share of e-cars in total car registrations is likely to fall slightly by 3 percentage points to 28% in 2023 compared to 2022.
Regarding this, VDA President Hildegard Müller stated:
"January's new registration figures already showed a significant decline in e-registrations. And we expect that the reduction in subsidies for purely battery-electric cars and the cancellation of subsidies for plug-in hybrids will continue to have a negative impact on the ramp-up of electromobility. This is why we have criticized the new subsidy scenario in the past. It is now all the more important to strengthen people's trust in electric mobility in other ways. Among other things, consumers need the certainty of being able to charge easily anytime and anywhere - but currently this is not the case.
A faster expansion of the charging infrastructure is needed, because the gap between the numbers of e-cars and charging points is still large. Statistically, there are currently 23 e-cars for one charging point in Germany. In order to achieve the federal government's goal of 1mn charging points by 2030, the average rate of expansion must be increased fivefold.
The fact is: An additional important factor for the further successful ramp-up of electromobility is the availability of raw materials. Batteries primarily need lithium, nickel, graphite and cobalt, and the electric motor needs rare earths for permanent magnets. This shows that the industrial change towards more climate protection requires a new raw material basis. We urgently need more commodity partnerships and trade deals with a focus on commodities. Germany and Europe's commitment to raw materials policy determines our competitiveness and thus our role and relevance on the way to climate neutrality.
It is also clear that the high electricity prices are causing considerable uncertainty for consumers, especially in the current economic situation. The high electricity prices must not become a brake - neither for the ramp-up of e-mobility nor for Germany as an industrial location. The electricity price must be permanently and effectively reduced. To achieve this, generation capacity must be expanded and the electricity tax reduced to the European minimum. In addition, taxes, fees and surcharges in the energy sector should be put to the test in general."
Müller emphasizes: "We, the German automotive industry, are driving forward climate-neutral mobility with massive investments. In the years 2022 to 2026 alone, companies in the German automotive industry will invest around €220bn in research and development, especially in electromobility, including but not limited to battery technology, and in digitization. In addition, there are around €100bn in the conversion of plants in Germany alone.
In addition, the German automobile manufacturers are constantly expanding their range. German manufacturers are already offering around 90 electric models in Germany alone. By the end of 2024 there will already be 100. There is something for every need and taste. Overall, the development shows that the e-car is increasingly becoming a mass product – due to the corresponding economies of scale, the models will also become cheaper in the future."