Record investment in electric cars and batteries in Europe in 2019

Europe secured €60bn in investments to produce electric vehicles (EVs) and batteries last year – 19 times more than in 2018, according to new analysis from Transport & Environment (T&E). Driven by EU car CO₂ emission targets, industry and governments committed 3.5 times more to EV and battery production in Europe than they did in China, says the study.

T&E argues that EU and national post-COVID aid to the stricken car industry should build on this investment and support a green recovery by prioritising EV production as well as purchase incentives to boost zero emission car sales, especially in corporate, taxi and car-sharing fleets.

Germany secured the biggest chunk of investment, €40bn, coming mainly from the Volkswagen Group, and Tesla which announced a plant in Berlin. The Czech Republic received €6.6bn, also thanks to VW, which plans to produce 75 all-electric models worldwide by 2029. Italy secured €1.75bn in EV investments last year from Fiat, while France, Sweden and the UK each got around €1bn from car manufacturers. Spain received close to €300mn from Opel, and Croatia got €80mn from Hyundai and Kia.

Saul Lopez, E-mobility Manager at T&E, says: ‘A few years ago Europe was nowhere in the race for EV supremacy. But EU CO₂ targets concentrated carmakers and governments’ minds to invest €60bn in electric cars and batteries and finally close the gap with China. Success in this market is now Europe’s industrial policy, and lawmakers should double-down with stimulus measures that will also drive a green recovery.’

The surge in EV investment resulted in a growing electric car market. However, EVs accounted for only 7% of sales in 1Q2020. As dealerships re-open, lawmakers should aim to regain that momentum with recovery measures such as loan guarantees and liquidity support for manufacturers prioritising EVs, suggests T&E. If scrappage schemes and purchase incentives are introduced, these should be used to drive EV sales especially in urban, public and private fleets, which accounted for 57% of all cars sold last year. Public money should also help individuals and companies to install charging infrastructure.

For Europe to lead on e-mobility, EU lawmakers should also accelerate the transition to zero emission cars by reviewing upwards the bloc’s 2030 car CO₂ targets next year. T&E is calling for the EU to ensure only zero emission models are allowed to be sold across Europe from 2035 at the latest.

Lopez concludes: ‘COVID-19 has wrought human tragedy and economic turmoil. But the EU and governments can use the recovery to emerge with a healthier, greener economy that reinforces its EV industrial strategy and creates thousands of jobs.’