The average price of an electric car in the European Union fell last year for the first time since 2020, new analysis from Transport & Environment (T&E) has found.
The average price of a battery electric vehicle fell by 4%, or €1,800, last year, to €42,700, the data showed, driven by the introduction of more affordable smaller EV models (in the so-called B-segment), where the average price fell by 13%.
This includes vehicles such as the Citroën ë-C3 and Renault 5, T&E noted.
‘Well on track’
T&E‘s analysis suggests that all manufacturers are ‘well on track’ to meet the EU’s 2025-2027 emissions targets, adding that with the introduction of more competitively-priced models, the next EU target in 2030 is expected to result in EVs achieving ‘price parity in all vehicle segments’.
The recent price drop is in contrast to the increase in prices observed in the EV market between 2020 and 2024, when the average price of a battery electric vehicle rose by €5,000, despite declining battery and component costs.
As T&E noted, weaker emissions standards during that period prompted car manufacturers to prioritise larger and more profitable EV models, rather than focusing on lower-cost vehicles.
“The EU targets are delivering cheaper electric cars to European drivers,” commented Lucien Mathieu, cars director at T&E. “The industry does not like to acknowledge that fact, but the timing of affordable new models last year is unmistakable. If we don’t weaken the 2030 target, buying a new EV will soon be cheaper than petrol.”
Emissions regulations
However, T&E also notes that proposed changes to EU emissions regulations could slow progress, with the European Commission mulling allowing manufacturers to average compliance with the 2030 car carbon dioxide target over a three year period, a move that could reduce the share of electric vehicles by as much as 10% by the end off the decade.
“EVs are on course to achieve price parity with combustion engines unless CO2 rules are weakened,” Mathieu added. “As carmakers reduce prices and improve their electric models, they will reach a tipping point beyond which they will grow their EV sales to meet the targets.
“But weakening the 2030 target now sends the signal to hold back affordable models and failure in 2030 becomes a self-fulfilling prophecy.” Read more here.
