When news broke in late November that Swedish electric battery maker Northvolt had collapsed, it signaled a grim outlook for clean mobility in Europe. The startup was once hailed as the continent’s best hope for producing affordable batteries on home soil, instead of relying on Chinese imports. Experts and some industry figures are now expressing doubt as to whether it will ever be possible for Europe’s carmakers to produce electric vehicles self-sufficiently.
The European Union (EU) has set carmakers a 2035 deadline to end sales of new petrol combustion engine cars on the continent. In the UK, the Labour Party government recently brought this deadline forward to 2030.
The continent’s rich carmaking heritage, coupled with these defined environmental targets, could in theory create a strong foundation for European manufacturers to lead the way in the global switch to electric mobility. Unfortunately, that’s not what’s happening.
Europe’s car giants have so far consistently failed to keep up with their Chinese counterparts when it comes to producing affordable and efficient EVs – models such as the BYD Seagull sell for as little as $10,000 in China, whereas the average price of a new electric car in Germany is €52,700– and take-up of the vehicles on Europe’s roads has been slow. Now, questions are arising as to whether Europe’s 2035 deadline will be met. Carmakers including BMW, VW and Renault, as well as the Italian government, have all recently called on the EU to revise or delay its targets.
In 2023 around 50 percent of the world’s electric cars were on China’s roads, according to the International Energy Agency. In Europe, plug-in vehicles are still struggling to gain momentum. Overall sales are down 1.7 percent this year after European governments withdrew a number of subsidies and incentives. There are several reasons for this discrepancy.
Firstly, Chinese manufacturers have been adept at producing low-cost EVs whereas their European counterparts have largely focused on the high-end market, in keeping with their wider business models.
Chinese companies do not have the same combustion engine legacy, said Carl-Friedrich Elmer from Agora Verkehrswende, a German think-tank focused on the shift to clean transportation. “They could start from scratch and focus all their energy [on EVs], without being distracted by further developing their combustion engine businesses.”
China’s expansive electronics industry also gave manufacturers a head start in battery technology know-how, he claims. As early as 2002, the Chinese government recognised that investing in electric mobility could give them a global advantage, as well as providing a solution for the relentless smog hanging over the country’s cities. The government poured subsidies into the industry, with some pure EV startups quickly becoming household names. Chinese companies also switched to lithium iron phosphate batteries, known as LFP batteries, which are safer and cheaper – although slightly lower energy density – than the lithium nickel manganese cobalt (NMC) batteries preferred by Western companies. The country struck multiple international deals guaranteeing companies access to a steady supply of raw materials needed for battery production.
With European EV sales and production lagging behind in comparison, a blame game has arisen between car manufacturers and policymakers. “A regulatory framework that ignores customer needs and market realities–and at the same time, is incapable of creating the necessary conditions for alternative technologies – cannot succeed,” a BMW spokesperson said in a written statement to WIRED, explaining that the company is opposed to the 2035 ban. It added that unless “charging infrastructure, availability of renewable energies and access to raw materials” are addressed, the ban will cause the “entire vehicle market” to contract.
Given that the car industry employs 13.8 million people across Europe and represents around 7 percent of the continent’s GDP, such a contraction would be economically disastrous.
Low car sales have already prompted Volkswagen to announce plans to shutter at least three factories, sparking anxiety in Germany over the country’s economic outlook. The far-right political party Alternative für Deutschland (AfD), which is currently second in the polls ahead of Germany’s snap general elections in February 2025, doesn’t support a combustion engine ban and has made the perceived economic cost of environmental policies a key part of its messaging.
“Let’s put it bluntly–consumers just don’t believe in e-mobility,” says Beatrix Keim, director of CAR Center for Automotiv Research. “The vehicles are perceived as too expensive, people are worried about battery safety, and are also concerned about charging costs.” She believes both politicians and the industry have a role to play in changing this, both through subsidies and investments in infrastructure such as charging solutions, and also through creating cheaper vehicles. “It could be tactical pricing, discounts, rebates, or just cut the prices throughout–which of course needs to be balanced with financial profits,” she says. “But overall, they [both] need to make the public understand e-mobility better and clear up some of the myths, such as battery safety.”
In an attempt to keep their factories and technologies alive, some European carmakers have floated the idea of “clean” fuels as a means to carry on selling combustion engine cars past the 2035 deadline. Germany has been at the forefront of this, successfully campaigning in 2023 for vehicles that run on “e-fuels” to be made exempt from the ban. E-fuels, which are still in the research and development stage, are made from combining hydrogen and carbon dioxide and, according to their proponents, release significantly less emissions than petrol.
However, not all industry experts are convinced. “E-fuels are complete nonsense,” claims Peter Mock, Europe managing director of the International Council on Clean Transport. “The efficiency of those fuels is terrible, which means the prices are very high–and they will stay high.” On top of this, he believes talk of alternative fuels is confusing for consumers–which could further harm EV sales. “EVs are simply the most efficient, the cheapest and the most convenient means of transport, and we need to communicate that,” he claims.
Of course, the 2035 ban will only apply to the countries of the European Union, while the continent’s carmakers will continue to sell globally. One solution could be a pivot to US markets, where predictions for EV sales throughout the Trump presidency are already being slashed.
“[European carmakers] already have plants there and they could easily expand them,” says Keim. “But then, they would also need to hire more people in the US.” She is doubtful as to whether Trump’s proposed migration policies would allow carmakers to source enough workers.
All experts who spoke to WIRED stressed they are still optimistic that the 2035 deadline will be met. Muck is hopeful that Volkswagen’s ID.1 and ID.2 cars, due on the market in the next few years, will crack the code for cheaper EV production.
However, in Germany, the heart of European carmaking, debate is rumbling on as to whether the 2035 phase-out deadline should be pushed back, or if the penalties for missing it—which could run into the billions—should be lowered. In the face of recent farmers protests, EU Commission President Ursula Von Der Leyen agreed to scrap the bloc’s plans to halve use of pesticides, raising questions as to how rigidly she will stick to other agreed environmental targets if the car industry stages similar protests.
Keim is adamant that a later date would be disastrous. “It would send completely the wrong message to consumers,” she said. “These targets have been known for long enough.” Muck compared the coming shift to electric vehicles as akin to the move to smartphones 15 years ago: “At some point the better technologies will succeed, and you cannot prevent that.”
Source : Wired
