By Nick Carey
(Reuters) - The European Union needs to provide more regulatory incentives for its carmakers to scale up fully electric vehicle (EV) production or risk losing market share to Chinese rivals, according to a study by climate group Transport & Environment.
In the T&E report 'From boom to brake: is the e-mobility transition stalling?' released on Monday, the group said that EV sales growth in the bloc had slowed, with fully-electric cars making up 11% of sales in the first half of 2022 when historical trends suggested they should have reached 13%.
In the meantime, Chinese carmakers including BYD and Great Wall Motor are looking to gain a foothold in the EU and have recently scored high safety ratings for their EVs.
T&E estimates Chinese-made EVs accounted for 5% of fully-electric car sales in the EU in the first half of this year and could have an 18% share of the market by 2025.
The EU is currently negotiating a proposed package of climate proposals, which includes an effective ban on the sale of new fossil-fuel vehicles from 2035.
T&E said to further stimulate European EV production, the EU should stick to the ban, oppose any exemptions for synthetic fuels in cars, remove an emissions benchmarking system from 2025 and use EU funds and national policies to accelerate the scale-up of EV production.
"The failure of EU carmakers to scale up...supply could result in foreign automakers offering affordable models and capturing a large share of the mass market in Europe," the report said.
"If the EU is unable to efficiently regulate its own market, it risks losing its economic sovereignty in the automotive industry."