Electric vehicle sales are gaining fresh momentum across Europe, helped by rising fuel prices linked to the Iran conflict. But while the latest numbers look strong, automakers are warning that this boost may not be permanent.
In May, EVs accounted for nearly a quarter of new vehicle registrations across much of Europe. According to data from New Automotive and E-Mobility Europe, new EV registrations rose 34% year-on-year across 17 European markets representing more than 90% of vehicle sales in the EU and EFTA.
Higher petrol prices appear to be pushing more buyers toward electric models. Renault CEO Francois Provost said EV orders have increased by as much as 50% in some markets since the Iran conflict began in late February. However, he admitted that demand could slow again if fuel prices start to fall.
Ford Europe has taken a similar view. Jim Baumbick, the company’s European chief, said expensive fuel has clearly increased customer interest in EVs, but he cautioned against treating the current rise as a lasting change in buyer behavior.
Fuel prices may remain elevated for now, especially as shipping routes linked to the Strait of Hormuz take time to normalize despite the extended ceasefire between the United States and Iran. Still, the risk for automakers is clear: if petrol becomes cheaper again, some buyers may lose urgency to switch.
Affordability Could Keep EV Demand Alive
That does not mean Europe’s EV market is relying on fuel prices alone. A growing number of more affordable electric vehicles, better charging infrastructure, and stronger availability in the used market could help support demand even if the current spike cools.
Chinese automakers are becoming a major part of that shift. Brands are moving beyond large SUVs and premium EVs into smaller, more accessible models. BYD, for example, recently introduced the Dolphin G in Berlin as part of its European expansion.
Former Nissan executive Andy Palmer, who helped launch the Leaf, believes buyers are being attracted not only by high fuel costs but also by competitively priced Chinese EVs that offer strong value.
Used EVs are also becoming more important. Supply is growing, and demand remains healthy. OLX reported that sales leads for Chinese brands in France rose more than fourfold in May compared with a year earlier.
Carwow Germany also said EV interest, measured through vehicle configurations and purchase inquiries, has stabilized between 70% and 75%, up from around 40% earlier this year. Its managing director, Philipp Sayler von Amende, believes the market may be moving beyond a short-term reaction to fuel prices.
Affordability remains one of the strongest arguments in favor of continued growth. Tesla’s major price cuts in 2023 pushed used EV values lower, making second-hand electric cars more attractive to buyers. Prices are now starting to recover as demand improves, with Danish marketplace Bilbasen expecting used EV prices to rise by around 10% this year.
Even so, used EVs still offer strong value compared with combustion models. In the UK, electric cars aged two to four years typically retain about 33% of their original value, compared with 52% for petrol and diesel vehicles, according to Cox Automotive.
Philip Nothard, Insight Director at Cox Automotive, believes the growing availability of affordable new and used EVs should continue supporting demand, even if fuel prices eventually come down.
For now, Europe’s EV market is clearly benefiting from high fuel prices. But whether this growth lasts will depend on more than petrol costs. If affordable models, charging access, and used EV values continue improving, the market may hold onto much of its momentum. If not, today’s surge could quickly start to fade.
