Europe's EV sales expected to top 200,000 this year

Sales of full-electric cars are set to surge to 200,000 this year, helped by the arrival of the new Nissan Leaf and the start of a wave of premium European EVs designed to challenge Tesla's dominance.

Demand for battery-powered vehicles is forecast to reach 600,000 by 2020 and rise to nearly a million by 2022, LMC Automotive predicts. This is a big change from last year when LMC says EVs surpassed the 100,000-sales barrier in Europe for the first time (EV sales were on track to reach 126,500 based on 10-month volume plus estimates for November and December, according to LMC).

Along with the second-generation Nissan Leaf, this year will see sales start for the Jaguar I-Pace electric SUV and the possible launch of the Porsche Mission E sedan. The production version of the Audi e-tron electric SUV is expected to be shown this year, but LMC doesn't believe the car will start reaching customers until 2019, citing information from Audi's parent Volkswagen Group.

The three premium models will bring additional attention to the electric market, but they won't make a huge impact in terms of sales, LMC director of powertrain Al Bedwell said. "They will be expensive and charging infrastructure is still an issue in almost all European markets," he said. Jaguar will reveal the production I-Pace in March along with pricing. Media reports suggest it will start at 60,000 pounds in its home market.

Early-arrivers benefit

LMC believes that future sales gains for the sector will be driven by the current market leaders. In 2020, it expects Europe's EV sales to be led by Tesla's Model 3 followed by the Renault Zoe, BMW i3 and Nissan Leaf.

The Volkswagen ID, the first of a range of VW Group battery-powered cars to be built on the automaker's MEB electric platform, is expected to finish its first year on the market at No. 5 in sales.

The top-five sales ranking forecast for 2020 is very similar to 2017’s chart, which was led by the Renault Zoe, according to 10-month figures from market analyst JATO Dynamics.

The Zoe increased sales by 49 percent after launching a version with a range of 400km as measured by the NEDC cycle. That stretched its lead over the first-generation Leaf and the third-ranked Model S, which just kept its lead over the BMW i3.

The VW e-Golf was fifth after sales rose by 66 percent thanks to its dominant position in Norway, Europe’s biggest market for full-electric vehicles.

The e-Golf's German sales have been sluggish. VW sold just 389 units of the e-Golf in October despite domestic subsidies amounting to 11,760 euros for those scrapping an old diesel car, according to figures from Sweden-based analyst AID. However, AID also reported that supply of the car has been constrained.

Market changes

Despite its market-leading position in Europe in terms of overall car sales, Germany was only third for electric car sales with a little more than 18,000 through 10 months of last year, JATO figures show. Norway was No. 1 with EVs accounting for a fifth of all new-car sales in the country. France ranked second.

However, the imminent rollout of electric cars from German brands such as VW will change that, according to estimates from LMC.

It expects Germany to become Europe's biggest EV market in 2019 with sales of 71,000. Germany's total is forecast to top 200,000 by 2022. In that same year, the UK will overtake France to become Europe's second-biggest EV market, LMC believes.

Emissions challenges

Higher electric vehicle sales will be crucial if manufacturers are to reach tougher emissions targets.

"E-mobility will become the key factor in meeting statutory requirements and mastering the associated financial challenges," VW said in a statement in November.

After the ID, VW will launch the electric Crozz compact SUV in 2020 and Buzz ID minivan in 2022.

The VW Group predicts that roughly one in four vehicles it sells by 2025 will be electric - amounting to about 3 million vehicles a year. The automaker said its global lineup, which includes the Audi, Skoda, and Seat brands, will have about 50 full-electric vehicles by 2025.

Other European manufacturers are equally bullish about their future EV portfolios. BMW Group will offer 12 full-electric vehicles by 2025, adding to the i3 a battery-powered Mini next year, followed by the BMW iX3 EV SUV and a year later by the iNext.

Rival Mercedes-Benz will launch "more than 10" full-electric vehicles by 2022 under its EQ subbrand, starting with the EQC electric SUV in 2019.

Other brands that promise to debut full-electric models in 2020 or sooner include Ford, Peugeot, Citroen, Mini, Volvo and Skoda.

This will remove one barrier to higher sales growth for the sector: limited choice. "We're talking about only 25 pure electric cars available now and only two are SUVs, neither of which is mass-market," said Felipe Munoz, global analyst for JATO.

"The real game-changers, the ones that will drive market growth, are still to come."