European Car Market in 2025 is stumbling. Full-year sales fell by 2.8% with Spain being again the standout country while growing 12.9%. The EV Sector continues to show double-digits growth, firmly led by Germany Turkey and Italy also expand steadily.
Economic Environment
Europe’s economic outlook for 2025 shows an uneven picture, with Ireland projected to surge to 10.2% (largely reflecting multinational-driven GDP distortions and front-loaded pharmaceutical exports ahead of threatened US tariffs), while Finland is expected to post roughly zero growth as weak confidence and a housing construction slump drag activity. Beyond these outliers, the next fastest growers in 2025 are projected to be Turkey (3.6%) and Poland (3.3%), highlighting that stronger momentum sits mostly outside the eurozone core.
For 2026, the OECD sees eurozone real GDP growth easing slightly to about 1.2% (from 1.3% in 2025), before edging up to around 1.4% in 2027. The broad European story is a gradual shift from the inflation-and-high-rates squeeze toward “improved financial conditions,” with falling interest rates expected to help consumption and investment. At the same time, trade frictions, especially tariff threats, remain a key downside risk, even if their effects are expected to be partly offset by easier financing. A major support for medium-term European growth is public and EU-backed capital spending, particularly through Recovery and Resilience Facility funding aimed at reforms and investment. Growth dispersion persists across countries in 2026, with Italy near the bottom (about 0.6%) and Poland, Turkey, and Lithuania among the leaders (around 3%+), the latter group also outperforming the projected global average. Among Europe’s biggest economies, Spain stands out as the fastest-growing in both 2026 (about 2.2%) and 2027 (about 1.8%), supported by jobs, real wages, and ongoing investment plans, while Germany and France sit closer to about 1% in 2026. Fiscal policy is another dividing line: Germany’s activity is expected to benefit from higher defence and infrastructure spending, whereas consolidation in France and Italy is projected to dampen growth.
Automotive Industry Trend and Outlook
The European Car Market totaled 14,3 million units sold in 2025, with a 2.8% loss in year-on-year volume compared to the prior year.
Looking at cumulative data, Germany retained the top spot. With a 1.3% year-on-year growth, it accounted for 22.1% of total European sales. UK followed in 2nd with a 15.7% market share (+3.5%). France closed the podium with a share of 11.2% (-5.1%).
Italy ranked 4th with a 10.5% share (-2.1%), followed by Spain in 5th with a 8% share (+12.9%).
Turkey ranked 6th (+10.6%), followed by Poland in 7th (+6.6%), Belgium -up 1 spot- in 8th (-7.5%) and in 9th by Netherlands -up 1 spot- (+1.7%). Austria -up 2 spots- closed the Top 10 (+12.3%).
EV Market Trend and Outlook
Europe’s EV market shows continued acceleration in 2025. Full-year sales grew by 29.2% to reach a 15% share of the total. The market is becoming increasingly competitive, with traditional automakers and new entrants trying to secure market share.
Moreover, more stringent CO2 emission targets results in regulatory pressure, continuing to prompt EV adoption across the continent.
Germany was still the sector leader, with a 18.6% share and a 40.4% increase. France gained 1 spot into 2nd, growing 1.1% to a 12.2% share while the UK closed the podium, down by 11.5% with a 11.6% share.
Notably, Turkey ranked into 4th growing 90.1% while Italy emerged as new contender, up by 77.7% and 2 spots.
Medium-Term Market Trend
The European automotive market, spanning 43 countries from Portugal to Russia, was the third-largest globally in 2024, following Asia and the Americas, with 14.17 million new car sales, marking a 0.9% increase from 2023.
From 2014 to 2019, regional sales grew steadily, rising 17.19% and reaching a decade-high in 2019.
However, the COVID-19 pandemic severely impacted the market in 2020, causing a 21.2% drop due to lockdowns, economic uncertainty, and supply chain disruptions.
In 2023, the market rebounded, growing by 16%, driven by pent-up demand and government incentives, stabilizing at around 14 million units into 2024.
Meanwhile, EV sales expanded rapidly, growing 183% between 2014 and 2017, fueled by technological advancements and supportive policies. Despite the COVID-19 crisis, the EV market nearly doubled in 2020, continuing a steady 300% increase from 2020 to 2024, reaching 15% market share, thanks to strict emissions regulations, improved charging infrastructure, and rising consumer awareness of sustainability.
Tables with sales figures
In the tables below we report sales for the top 20 countries.
