Electric Car Average Price Falls by €1,800 as Carmakers Release Affordable Models to Meet EU Target — Analysis

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But weakening carmakers’ next target in 2030 is likely to delay EVs reaching price parity with combustion vehicles.

The average price of an electric car in the EU has fallen for the first time since 2020, driven by the release of more affordable models to comply with the bloc’s car CO₂ targets. That’s according to a new analysis by T&E which finds that all manufacturers are well on track to meet the 2025-2027 emissions targets. By pushing carmakers to bring even more competitively priced models to market, the next EU target in 2030 is expected to result in EVs achieving price parity in all vehicle segments.

The average electric car price decreased by €1,800 (-4%) to €42,700 in the EU last year, the analysis finds. The fall was mainly driven by the introduction of affordable, small EV models in the B-segment, where the average price decreased by 13% in 2025. Cheaper mass-market models such as the Citroën ë-C3 and Renault 5 were launched just in time to help carmakers comply with the EU’s 2025 car CO₂ target.

Last year’s price drop is in stark contrast to the period between 2020-2024 when the average EV price climbed by €5,000, the report finds. That was despite the cost of batteries and other EV components falling. T&E said weak EU CO₂ targets in that period had enabled carmakers to focus on selling larger, more profitable EVs.

Lucien Mathieu, cars director at T&E, said: “The EU targets are delivering cheaper electric cars to European drivers. The industry does not like to acknowledge that fact, but the timing of affordable new models last year is unmistakable. If we don’t weaken the 2030 target, buying a new EV will soon be cheaper than petrol.”

The analysis also finds that carmakers representing half the market have already complied with the 2025-2027 EU target, two years ahead of time. Only Renault and Volkswagen are lagging behind but are still expected to meet their target by the end of 2027.

EVs reached price parity with combustion vehicles in segments D and E in 2024, according to the analysis. Electric cars in segments A, B and C should achieve price parity with combustion cars by 2030 if cost reductions are passed onto consumers. But this risks being delayed if EU lawmakers weaken the 2030 car CO₂ target, as the European Commission has proposed, allowing manufacturers to pursue larger margins. That would result in the average EV being €2,300 more expensive in 2030 than under the current target.

The EU Commission’s proposal to average the 2030 target over three years would cause EV adoption to slow from 57% market-share in that year to 47%, the report forecasts. The car industry’s demands to average the target over five years would result in a market share of just 32% in 2030. T&E said this would derail the electric vehicle transition, leaving the EU further behind in the global EV race and putting jobs and investment at risk.

Lucien Mathieu said: “EVs are on course to achieve price parity with combustion engines unless CO₂ rules are weakened. As carmakers reduce prices and improve their electric models, they will reach a tipping point beyond which they will grow their EV sales to meet the targets. But weakening the 2030 target now sends the signal to hold back affordable models and failure in 2030 becomes a self-fulfilling prophecy.”

Article from T&E.