It’s historic! Europe switches to 100% electric cars by 2035

After months of debate and intense lobbying, MEPs voted to end the sale of (new) petrol, diesel and hybrid cars by 2035. In fact, only electric cars can be sold, excluding the second-hand market.

Fuels remain an option

Petrol and diesel vehicles will continue to circulate in the EU after 2035. The law only concerns the sale of new vehicles.

Europe will be the first major market to overtake China and the United States, but Norway has already set a deadline of 2025 and Israel of 2030.

Hybrids and electrics are taking over

Under the influence of European regulations, public subsidies and the growing supply of hybrids and electrics, gasoline vehicles are already in decline. This mainly benefited mild hybrids (petrol and diesel), which accounted for a quarter of European sales in the first quarter of 2022.

Plug-in hybrids accounted for 8.9% of the market and electric 10% (+53.4% ​​in one year). Quite sophisticated at the moment, they are increasingly numerous on Dutch, Swedish or German roads in particular. But they are far from zero emissions, their emissions even being comparable or worse than those of a gasoline car if their owner does not recharge them.

Most Europeans now think their next car will be hybrid or electric, according to a survey by the European Investment Bank.

A big question remains: “What will drive a family to switch to two electric vehicles?” says Eric Kirstetter of Roland Berger. “People tend to cling to a combustion vehicle for fear of weekend trips or holidays.”

The car, a luxury product?

The prices of electric cars, which are now much higher than those of internal combustion engines, could fall rapidly as they are mass produced and the cost of batteries drops.

The Stellantis group (Peugeot, Fiat, etc.) estimated in early 2022 that parity could be reached between 2025 and 2030, but prices for many materials have exploded since then.

“Electricity is going to be structurally very expensive for a while. We are heading towards a market increasingly focused on those who have more resources”, warns Eric Kirstetter.

In the second-hand market, which worries most drivers, electric models are also starting to multiply.

On the other hand, the price of thermal cars is expected to increase as government penalties increase. Thermals could then experience an unexpected effect on the second-hand market, according to Kirstetter.

The industry needs to change

France, Germany, Spain, Italy… In each of these countries, the automotive industry represents a significant portion of industrial jobs.

But manufacturing electric vehicles requiring less labor than thermal vehicles, the energy transition could destroy many jobs despite the establishment of battery factories. In France, for example, the switch to electric could cause the loss of 65,000 jobs out of 200,000 in the sector, according to the automotive platform (PFA).

This transition is also an “unprecedented opportunity” for start-ups like Tesla and for Chinese manufacturers, supported by their government and an expanding local market, underlines Felipe Muoz of the Jato office.

less emissions

“Low carbon electric vehicles offer the main potential for the decarbonization of land transport, in the analysis of the life cycle”, that is, including in the manufacture of batteries, underline UN climate experts (IPCC).

Without exhaust gases, the electric car also does not pollute the air in city centers. But it is not “green” for all that, because it is necessary to produce the electricity that animates it, which is done with coal plants in some countries.

As for the manufacture of batteries, its main components come from mining, in countries with social rules that are often non-existent or incomplete.

Extracting and processing them creates new strategic dependencies, in China for example, and recycling them remains expensive.

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