Europe car sales dip in January; Petrol models see sharp drop

Europe's Auto Market Faces Continued Slowdown

European car sales have experienced another challenging month as new vehicle registrations in the European Union fell by 3.9% year-on-year in January 2026[3][5]. The decline represents a troubling trend for the automotive industry, marking the second consecutive month of declining sales at the start of a calendar year. The broader market, which includes the EU, European Free Trade Association countries, and the United Kingdom, registered approximately 961,382 units during the month[1]. This persistent downturn signals ongoing headwinds for manufacturers across the continent as they navigate shifting consumer preferences and economic pressures.

Petrol Cars See Sharp Decline Amid Industry Shift

The most dramatic change in the European automotive landscape has been the collapse of petrol vehicle sales, which dropped by 28.2% during the same period[3]. This steep decline reflects a fundamental transformation in how European consumers approach vehicle purchases. The combined market share of petrol and diesel automobiles fell significantly to just 30.1%, down from 39.5% a year earlier[3]. This shift marks a decisive departure from traditional combustion engine vehicles, signaling that consumers are actively turning away from conventional power sources. The decline has been particularly severe in certain regions, though hybrid-electric vehicles have emerged as a popular alternative, demonstrating that buyers are seeking transitional technologies alongside fully electric options.

Battery-electric vehicles have captured an increasingly dominant position in the European market, reaching a 19.3% market share in January 2026, up substantially from 14.9% in the same month last year[3]. A total of 154,230 new battery-electric cars were registered across the EU during January[3]. However, the growth trajectory varies considerably across different European nations. [3] In France, battery-electric vehicle sales surged by 52.1%, while Germany experienced a more modest increase of 23.8%[3]. Conversely, the Netherlands witnessed a sharp contraction of 35.4% in electric vehicle registrations, and Belgium saw a decline of 11.5%[3]. These divergent regional trends suggest that national policies, charging infrastructure availability, and consumer sentiment toward electric vehicles play significant roles in shaping purchasing patterns across Europe.

Hybrid-electric vehicles lead as the most popular power type choice among buyers, with plug-in hybrids consolidating their position in the market, underlining the importance of a technology-neutral pathway to decarbonisation.

Implications for Europe's Automotive Future

The January 2026 data paints a picture of an automotive industry in transition, with clear winners and losers emerging in the shift toward electrification. The rapid decline of petrol vehicle sales reflects both regulatory pressures pushing manufacturers toward cleaner technologies and genuine shifts in consumer preferences toward alternative powertrains. While electric vehicles are growing substantially, the uneven performance across European markets indicates that the transition to electrification faces regional complexities. The strong performance of hybrid-electric vehicles suggests that many consumers remain cautious about fully committing to battery-electric technology, preferring transitional solutions that offer flexibility and reduced range anxiety. The overall 3.9% decline in registrations alongside these dramatic powertrain shifts highlights the challenges facing European automakers as they balance declining overall demand with accelerating technological transformation. For consumers, suppliers, and policymakers, these trends underscore the urgent need for continued investment in charging infrastructure, manufacturing capacity for electric vehicles, and support mechanisms to facilitate the industry's ongoing evolution.