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Plug-in Hybrid Sales Fall as Demand for Full EVs Increases

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Sales of plug-in hybrid vehicles are faltering in Europe, which has been their most important market to date, while demand is rising for all-electric vehicles.

Related: Toyota Lambasted Again in Europe For Not Going ‘All In’ on EVs

As consumers turned away from diesel cars after Volkswagen’s dieselgate scandal and Europe’s lawmakers toughened the emissions regulations, some automakers bet heavily on plug-in vehicles, which are powered by an internal combustion engine and an electric motor that can propel the vehicle without emissions for short distances.

However the latest data shows that sales of plug-in hybrids in France fell by 28% in June. In Germany which was another former stronghold for the technology, sales of plug-in hybrids dropped by 16%. In the UK, plug-in hybrids were neck-to-neck with full-electric vehicles as recently as 2019. But now, two battery-electric cars on average, sell for one plug-in model.

Related: EU Countries Agree to Ban New ICE Cars by 2035

Interestingly, a recent study of 9,000 vehicles from the International Council on Clean Transportation found that real-world fuel consumption from plug-in hybrids was 2.5 to 5 times higher than what is approximated under official laboratory testing procedures. That gap between theory and practice is part of the reason national governments are cutting purchase subsidies for plug-in hybrids faster than for full-electric models.

Ford Kuga was Europe’s No. 1 selling plug-in hybrid in 2021 with a volume of 46,319

For example, UK eliminated purchase subsidies for plug-in hybrids in 2018, while Germany announced just last week that subsidies will end this year. Furthermore, upcoming policy changes could further erode the case for plug-in hybrids. The European Commission is expected to introduce new “utility factors” for these models from 2027. These are the values intended to reflect how often the plug-in vehicles are driven in electric mode, and critically, what CO2 emissions value they are assigned. The goal for this regulation is to use real-world driving behavior from vehicles to set the values, using on-board monitors.

Related: Japan Elevates Hybrid Policy After Toyota Chief’s Warning

Unless something dramatic changes in the next few years, this will make plug-in hybrids a less attractive way for automakers to meet emissions regulations. Manufacturers will see this change coming down the road and start to allocate the investments accordingly. Plug-in vehicles are cumbersome to produce and with growing popularity of EVs, the future of plug-in hybrids may not be too bright as it looked to be a few years ago.

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