Energy
Monday, September 5th, 2022 10:05 am EDT
Europe’s second largest auto market, France, saw plugin electric vehicles take 21.0% share in August, up modestly from 19.8% year on year. Overall auto volumes for the month were 91,403 units, an improvement over 2021, but still almost 30% down on August 2019. The bestselling full electric was again the new Renault Megane.
August’s combined plugin result of 21.0% comprised 13.5% full battery electrics (BEVs), and 7.5% plugin hybrids (PHEVs). Their respective shares in August 2021 were 11.3%, and 8.5%. As with other European markets, PHEVs are losing share this year, whilst BEVs are generally still growing share at a steady rate.
In volume terms, PHEVs lost 7.9% of their volume YoY, but BEVs grew 24.3%, giving the combined category modest overall growth.
Plugless hybrids (HEVs) gained more share YoY than plugin powertrains (21.5% from 19.3%).
Petrol share grew by 0.7% YoY, but was far outweighed by diesel share dropping by 2.7%. Combined combustion-only powertrains held 54.0% share, from 55.9% YoY.
Les BEV Les Plus Aimés
The new Renault Megane is proving unstoppable in France, now taking the top spot for the second month in a row. Bear in mind that the Megane only started delivering in volume in May!
Runner up spots were taken by regular faces, the Fiat 500 and Dacia Spring.
The new Megane is obviously a big hit for Renault, and is a right-sized vehicle for many European families. With 3 of the top 5 spots, Renault Group’s BEVs are doing great in their home market.
We don’t yet have the depth of model sales data that allows us to detect the rise of freshly released BEVs, since they only become “visible” when they have already climbed near to the top 10. Keep an eye out for Jose’s report later this month, for more detail.
Let’s now take a step back for a longer view over the trailing 3 months:
As expected, the Renault Megane has now taken the overall lead, ahead of the Peugeot e-208 and Fiat 500e. This is a remarkably fast rise for the Megane, from 14th spot in the previous March-to-May period. If you are not yet familiar with this hot new BEV, check out Jonny Smith’s video review for a good overview.
Renault Group models also hold spots 4, 5, and 6 of the rankings — impressive.
Here are the notable climbers compared to the rankings 3 months ago:
On the other hand, some models had significant falls in ranking:
Other movements were just minor changes, lower down the rankings.
Notice that the top 6 bestsellers are all small vehicles, with the largest, the Megane just 4.2 meters long (shorter than the classic VW Beetle). The 208 and Zoe are barely 4 meters long, and the 500, Twingo, and Spring are just around 3.6 meters.
Beyond BEVs, France’s overall top 10 vehicles are mostly of similar proportions, with the top 3 all sized right around 4.0 meters.
Italy, Spain, and many other regions of continental Europe also favour compact and small vehicles, and the UK’s bestsellers are barely any larger. As we move forwards, and more model options at more affordable prices become available, the continent’s best selling BEVs will likely increasingly be in this format.
Outlook
What’s the state of France’s auto market from the consumer-sentiment side, and from the industry side?
France’s overall inflation rate has hovered around 6% over the past 3 months, from 1.6% YoY. Food inflation is yet higher, and energy much higher still.
Electricity prices have exploded over recent months. The end of August briefly saw French wholesale electricity spot prices at €1130 / MWh, up over 1100% YoY from €90. This has recovered to “just” €600 now. France will restart all of its nuclear generation fleet in the coming months to try to counter the shortfalls and extreme prices.
With households’ energy bills being somewhat politically protected across much of Europe (but still already having risen 100% to 200% in many cases), the energy inflation burden has fallen even harder on small and medium businesses.
One of the more relatable and well know examples is that 70% of UK pubs do not expect to be able to remain economically viable over the winter, due to energy prices going up by 300% to 400%, or even more in some cases.
It’s the same situation for many businesses across Europe, especially small to medium businesses that can’t easily raise financing, or shuffle balance sheets, to attempt tide them over. Businesses that are energy intensive, like manufacturing, chemicals and heavy industry are all in a very tough place with every prospect of even more price pressure ahead.
Several German companies have already halted production at their factories in response to the rocketing energy prices, according to the Financial Times.
In France, Macron has recently said that regular folks must prepare themselves for sacrifices and an “end of abundance” in order to stay on track with the EU’s sanctions policy on Russia. At the same time, at least he is one of the few European politicians still keeping communication channels open with Moscow to try to find a resolution to the crisis, though he is facing much criticism for doing so.
Meanwhile, French manufacturers are also shutting down their production due to the sky-high energy prices. As one textile manufacturer recently said, “We can no longer compete with the international market because of the astronomical costs of electricity.” (machine translation).
It is inevitable that France’s automakers, and/or their supply chains will also be affected — to some greater or lesser extent — by the energy and inflation crisis, and resulting consumer behaviour, so all bets are off as to what the auto market might look like over the coming months.
For EV owners able to take advantage of off-peak (e.g. overnight) electricity tariffs, the energy costs of an EV are still somewhat lower overall than for combustion vehicles. Those (diminishing number of) consumers who are unaffected by inflation and recession, may still remain relatively interested in plugins.
What are your thought on France’s economic outlook, and the auto industry and consumer market? Please jump into the comments below to join in the discussion.
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