The average price of a new electric car in Europe fell for the first time since 2020 last year, providing a significant boost to sales even as the European Union considers scaling back its climate mandates for automakers.
A report by the advocacy group Transport & Environment (T&E) found that electric vehicle (EV) prices across the EU and Norway dropped by 4%, or €1,800, to an average of €42,700. This decline was driven by the launch of new, more affordable small EV models. As a result, EVs accounted for 19% of all new car sales in the region in 2025, up from 14% the previous year.
The group attributes the price reduction directly to the EU’s stringent CO2 emission standards, which force manufacturers to sell more zero-emission vehicles or face steep fines. “Even if the automotive industry doesn’t like to admit it, the EU’s CO2 standards have enabled hundreds of thousands of Europeans to access more affordable electric cars,” T&E stated. All major carmakers are currently on track to meet the interim emission targets for 2025-2027, the first major hurdle toward the 2035 goal.
This progress comes as EU environment ministers prepare to debate a proposal next week to weaken the 2035 ban on new petrol and diesel cars. The automotive industry, which has lobbied heavily against the rules, argues the original target is unattainable. Under a plan from December, the 2035 target would be relaxed from a 100% cut in exhaust emissions to a 90% reduction. Additionally, “super credits” would be granted for small, affordable EVs produced in the EU, a mechanism that would make compliance easier.
However, industry lobby group ACEA is pushing for further concessions, including extending the timeframe for meeting a key 2030 intermediate target from three years to five. The debate highlights a tension between industry demands and climate policy effectiveness.
T&E’s analysis suggests that maintaining the current emission targets is critical for achieving price parity between electric and combustion engine cars by 2030. The coming weeks of negotiations in Brussels will determine whether regulatory pressure continues to drive EV affordability or is diluted in response to industry pressure, with profound implications for Europe’s decarbonisation of transport.
