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car sales in europe stagnated in july as demand for electric vehicles lagged behind in germany. the latest data released by the european automobile manufacturers association on thursday showed that new car registrations in europe rose only slightly by 0.4% to 1.03 million in july. the performance of the region's four major markets was mixed: italy and spain both recorded small increases, while the french and german markets declined. at the same time, electric vehicles accounted for 13.6% of total sales in europe, down from 14.5% last year. gasoline car sales fell 8.4% year-on-year, while diesel car sales fell 11% year-on-year. hybrid vehicles were the biggest winner this month, with registrations up 24%.

germany, the largest auto market in europe, saw a sharp drop of 37% in demand for electric vehicles, the largest annual decline, which became the main reason for the overall auto market. analysts pointed out that the european governments' successive cuts in subsidies for electric vehicles, as well as the continued downturn in the german economy and the decline in consumer purchasing power were the main reasons for the cold reception of the european electric vehicle market.

germany abruptly ended subsidies for electric vehicles in december, but the reduction in subsidies has put more pressure on consumer spending amid the country's ongoing economic downturn.

"growth in electric vehicle registrations is likely to continue to slow due to a lack of incentives and consumer interest beyond first adopters," analysts said in a report. "(european) electric vehicle incentives and unclear future prospects continue to hinder consumers from considering buying electric vehicles. these factors, coupled with low residual values ​​of electric vehicles, led to a decline in electric vehicle sales in july," said felipe munoz, jato's senior global analyst, referring to the decline in total electric vehicle sales in europe.

the irish independent said that after countries such as germany and sweden stopped or cut subsidies, demand for electric vehicles in europe is cooling, and many manufacturers have even postponed plans to develop electric vehicles. for example, volkswagen group plans to further cut costs and has closed the audi electric vehicle factory in belgium.

also facing difficulties is stellantis group, whose net income almost halved in the first six months of this year and its ceo issued a stern warning about underperforming brands.

in addition, mercedes-benz group also lowered its profit margin forecast for this year and slowed the pace of its transition to electric vehicles, saying that "the transition to internal combustion engine vehicles will take longer than expected."

in this context, if the eu still insists on raising tariffs on chinese electric vehicles, it may further cool down the demand for electric vehicles in europe. on august 20, local time, the european commission released a draft final ruling on the anti-subsidy investigation on chinese electric vehicles, adjusting the initial tax rates: 17% anti-subsidy tax on byd, 19.3% on geely, 36.3% on saic, 21.3% on other cooperative companies, and 36.3% on all other non-cooperative companies.

although the eu claims that these tariffs are aimed at protecting europe's domestic auto industry, they may ultimately backfire, further increasing the cost for european consumers to buy electric vehicles and further cooling the european electric vehicle market.

china-eu automotive industry cooperation began 40 years ago, when volkswagen of germany took the lead in establishing a joint venture with chinese companies. over the past 40 years, eu-china automotive industry cooperation has achieved fruitful results. in the view of maarten steinbuch, a professor at eindhoven university of technology in the netherlands, china is an extremely important sales market for european automobile brands. european automakers such as bmw, mercedes-benz and volkswagen all have factories in china and sell a large number of products back to europe and other places. imposing tariffs will also harm the interests of these european companies.

it is worth mentioning that tesla model 3 cars sold to europe from the shanghai factory also became the subject of eu taxation. at that time, tesla was expected to be subject to an additional tariff of 21%.

although tesla immediately asked the european commission to conduct a separate investigation, in july, tesla still raised the price of model 3 in eu countries such as france, germany, and italy. according to the official website, the price increase of model 3 in the eu is about 1,500 euros (about 12,000 yuan).

industry insiders said that the eu's unilateral measures are by no means a solution and will hurt european car companies and consumers. in estonia, car dealers such as united automotive generally believe that the eu's decision will not have a positive impact on car sales, but will only lead to higher prices for electric vehicles, harming the interests of european consumers.

the wall street journal said that some european automakers, including volkswagen, opposed the eu's imposition of tariffs on imported electric vehicles from china, fearing that this would lead to an escalation of trade frictions and could damage europe's auto industry in the long run. euronews quoted ing as saying that tariffs would increase the price of electric vehicles in the eu market and slow down the eu's progress in achieving zero emissions.

beijing business daily comprehensive report