Automotive Market in Europe is to grow at an 8.9% CAGR, with Germany leading the market through 2030

Automotive Market Size in Europe is expected to reach USD 29.55 Bn by 2030. Key drivers include increased demand for electric vehicles (EVs), technological innovations, and a shift toward sustainable automotive solutions.

Market to Hit USD 29.55 Bn by 2030

Automotive Market in Europe was USD 16.26 Bn in 2023 and is expected to expand at a compound annual growth rate (CAGR) of 8.9% from 2024 to 2030, reaching USD 29.55 Bn by 2030. Electric cars made up 15% of all new car sales in Europe in 2023, a huge increase from just 3% in 2019. In 2023, EV sales in Germany, the biggest automobile market in Europe, increased by 50%. Volkswagen and BMW both increased their electric car lineups in an effort to gain a bigger piece of this quickly increasing industry. Alongside the growth of EVs, hybrid cars are also gaining popularity. Sales of hybrid cars increased by 40% in France in 2023, making up about 25% of the country's total automobile market. By 2024, it is anticipated that the market for electric vehicles alone would generate €130 billion due to the rising demand for environmentally friendly automobiles. Volkswagen is demonstrating the wider trend toward electrification by investing more than €30 billion in electric transportation by 2025. 

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Market Segmentation

By Vehicle Type: Passenger vehicles continue to dominate the European auto market because consumers value modern technology, compact size, and fuel efficiency. The market is also shifting toward electric and hybrid passenger cars as a result of the increased focus on ecologically friendly vehicles, with substantial acceptance observed in countries like Norway, Germany, and the UK. 

By Fuel Type: Gas-powered automobiles rule the European market despite the growth of electric vehicles, particularly in nations with less developed charging infrastructure. Stricter pollution laws and incentives for electric vehicles, however, are progressively undermining the preference for gasoline-powered automobiles. 

Market Regional Analysis

Germany, maintains its dominance in Europe's auto manufacturing and consumption. Located in the country, luxury automakers including as Mercedes-Benz, BMW, and Volkswagen export their cars worldwide. 

France, is home to well-known companies like Peugeot and Renault, making it a major force in the European auto industry. As an outspoken supporter of environmentally friendly transportation, the French government has provided significant financial incentives to encourage the use of EVs. Because of regulations and environmental concerns, the French car sector is shifting to electric and hybrid automobiles.

United Kingdom, combines conventional automobiles with an increasing number of electric ones. With more government money going toward EV infrastructure and charging stations, the shift to electric vehicles is picking up speed.

Market Competitive Landscape

Volkswagen: March 2025, announces the release of its new electric vehicle model, aimed at increasing the company’s market share in the growing EV sector in Europe. With a range of 500 miles on a single charge, the new model is expected to appeal to environmentally conscious consumers.

BMW: March 2025 has expanded its manufacturing facility in Munich to increase production capacity for electric vehicles. This move is part of the company's strategy to meet the growing demand for sustainable mobility in Europe.

Renault: February 2025, announces a new investment plan to build a state-of-the-art EV battery manufacturing plant in France. This initiative is aimed at bolstering the French automaker’s capacity to produce electric vehicles locally and reduce reliance on foreign suppliers.

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Key Company Analysis

Volkswagen, remains one of the dominant players in the European automotive sector. In 2023, the company achieved €295 billion in revenue, with 9.3 million vehicles delivered globally. Of these, over 1.2 million were electric vehicles (EVs), marking a 60% year-over-year increase in EV sales. Volkswagen's push into electric mobility is significant, as it targets producing 70% of its vehicles as electric by 2030. The launch of the ID.4 and other EV models has strengthened its presence, while the company is investing €60 billion over the next 5 years in electrification and digital transformation. 

Deutsche Telekom, in 2023 the company posted €114 billion in revenue, with a focus on 5G technology and connected mobility solutions. Deutsche Telekom has partnered with leading automakers like BMW, Volkswagen, and Daimler, providing connected vehicle services to over 500,000 vehicles across Europe. The company is also investing €1 billion in enhancing automotive infrastructure, including EV charging networks and autonomous vehicle technology. 

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