European sales rise 1.7% in February on growing EV demand

New car registrations across the European Union, UK, and EFTA rose 1.7% year-on-year in February to 979,321 units, according to ACEA data published on 24 March, with electrified vehicles—battery-electric (BEV), plug-in hybrid (PHEV), and hybrid combined—accounting for fully 67% of sales, up from 58.5% in the same period of 2025. BEV registrations rose 15.8%, PHEVs climbed 33%, and hybrids grew 10.4%, while petrol fell 17% and diesel declined 13.5%.

The gains came despite a 14.3% fall in France, due in large part to changes to environmental tax laws, and the end of the social leasing programme that made it easier for lower-income households to purchase BEVs. This drop was offset by solid growth in markets including Germany, Italy, Spain and the UK. Reflecting this trend, Volkswagen registrations rose 2.2% and Stellantis 9.5%, while Renault fell 14.3%. 

Affordable new models—particularly from Chinese players—and the reintroduction of national subsidy programmes were cited as primary demand drivers, although environmental groups highlighted that the reclassification of some petrol models as mild hybrids has contributed to the appearance of electrified market share without an equivalent reduction in CO2 emissions.

Tesla was arguably the month’s biggest winner, posting a partial recovery from its brutal 13-month slump across European markets. The automaker posted 11.8% growth year-over-year for a total market share of 1.8%. Declining competitiveness with both Chinese players and consumer revulsion against Chief Executive Elon Musk’s political activities are widely cited as the reasons for the decline. 

The bump leaves Tesla narrowly behind BYD, which more than doubled its February registrations year-on-year to claim an equal 1.8% share on the back of aggressively priced models and a rapidly-expanding European dealer network. Tesla had trailed BYD in Europe through large portions of 2025. 

BYD’s growth illustrates a broader Chinese market adaptation. EU tariffs of up to 45.3% on Chinese automakers—27% for BYD specifically—have not reversed Chinese brand momentum but have shifted the product mix, with brands including BYD and Leapmotor increasingly selling PHEVs to circumvent the rules, which affect BEVs only. That flexibility has allowed Chinese brands to sustain their sales growth even as the tariff architecture was ostensibly designed to constrain it.

It should be noted that the February data reflects consumer decisions made before the outbreak of the US-Israel-Iran conflict on 28 February and the subsequent disruption to Strait of Hormuz shipping. Early March indicators, including a 40% rise in EV-related online traffic on German platform MeinAuto and a near-40% EV inquiry spike across European platforms in the first week of March, all suggest the conflict is already shifting consumer sentiment. 

However, this will take slightly longer to manifest in the sales data. European registration data generally tracks deliveries, so a switch in consumer purchasing habits may not be immediately reflected in the data from March alone. European gasoline prices have risen approximately 8% since the conflict began but have not yet reached the psychological threshold—around €2.30 per litre—that is widely considered the threshold for a major shift in purchasing habits on the continent.