Economy & Business18 Oct 2026 · about 6 min

Europe’s EV sales soar as North America drops 44% – here’s the catch

The brief

EV growth is shifting toward Europe and smaller markets, while North America and China are declining against strong 2025 comparisons. Europe had its best September ever, but the global picture was mixed. Worldwide September sales reached 2.15 million, down 2% year over year. Europe sold almost 600,000 EVs, up 39% year over year and 62% from August. BEV sales rose 50%, while PHEVs grew 16%. North American sales fell 44% to around 130,000. China remained the largest market, selling 1.11 million, up 7% from August but down 18% year over year. The regional differences matter because Europe supplied much of the current growth. Through September, European sales reached 3.9 million, up 30%. North America was down 24% for the year, and China was down 13%. Outside these regions, sales rose 81% in September.

Where are electric vehicle sales growing or declining, and what were the main September changes in Europe, North America, and China?

Europe sold almost 600,000 EVs, up 39% year over year and 62% from August. BEV sales rose 50%, while PHEVs grew 16%. North American sales fell 44% to around 130,000. China remained the largest market, selling 1.11 million, up 7% from August but down 18% year over year.

The regional differences matter because Europe supplied much of the current growth. Through September, European sales reached 3.9 million, up 30%. North America was down 24% for the year, and China was down 13%. Outside these regions, sales rose 81% in September.

What is the difference between a battery electric vehicle (BEV) and a plug-in hybrid electric vehicle (PHEV)?

A battery electric vehicle, or BEV, uses a rechargeable battery and electric motor as its only propulsion system. It has no gasoline engine. A plug-in hybrid electric vehicle, or PHEV, also has a rechargeable battery and electric motor, but it includes a gasoline engine as well.

The key difference is how each vehicle can travel after its battery charge is used. A BEV must recharge from an electrical source. A PHEV can recharge externally and drive electrically for part of a trip, then use gasoline when needed. This makes PHEVs a mixed technology rather than fully electric propulsion.

The article combines BEVs and PHEVs in its overall EV totals, but their trends differ. In China through September, PHEV sales fell 25%, compared with a 6% decline for BEVs. In Europe during September, BEVs grew 50% year over year, versus 16% for PHEVs.

How large are the major regional EV markets, and how many EVs were sold worldwide through September?

The major EV markets are very different in size. China remains the largest by a wide margin, with 8.1 million EVs sold through September. Europe followed with 3.9 million, while North America reached 1.2 million. These totals include battery electric vehicles and plug-in hybrids.

The worldwide total was 15.5 million EVs through September, up 3% from the same period last year. September alone produced 2.15 million sales globally. China contributed 1.11 million in that month, Europe almost 600,000, and North America around 130,000.

Scale does not equal growth, however. Europe’s year-to-date sales were up 30%, while China’s fell 13% and North America’s fell 24%. Markets outside those three regions sold 2.3 million EVs through September, up 93%, showing that newer markets are becoming an important source of expansion.

Why did North American EV sales appear to fall 44%, and how did the expiration of the US $7,500 tax credit affect the comparison?

North American EV sales appeared to collapse because September 2025 was an exceptional month. The US federal $7,500 EV tax credit was about to expire, so many buyers moved purchases forward. That created a very high sales base for comparison this year.

September 2026 sales were around 130,000, down 44% year over year and 8% from August. The decline is real, but the percentage exaggerates the suddenness of the change because it compares with the final month of the incentive. The credit’s removal also caused US EV sales to collapse in the months afterward.

Benchmark expects the year-on-year picture to improve markedly from the fourth quarter. Later comparisons will use those weaker post-credit months as the baseline. Smaller declines will therefore not necessarily prove that demand has recovered; they may simply reflect an easier comparison.

What could happen to EV prices, production, and consumer choice if European countries restrict imports of Chinese-built electric vehicles?

Restricting Chinese-built EV imports would change how European buyers and manufacturers compete. Fewer imported vehicles could mean less choice, especially if Chinese automakers currently offer models at prices or in categories that local producers do not match. The article does not quantify future price changes, so any price effect remains uncertain.

The proposed EU–China agreement would cap Chinese-built BEV and PHEV imports at 350,000 in 2027. The cap would rise 6% annually after its first year. In general, an import limit can push automakers toward European production, while limited supply can place upward pressure on prices.

Chinese companies may also face higher export costs. China plans to cut its new energy vehicle export VAT rebate from 13% to 9% on April 1, 2027. Together, the measures could affect production locations, prices, and model availability, but the agreement still needs member-state approval.

Why are Chinese automakers exporting more vehicles, and what other markets are driving EV growth outside China, Europe, and North America?

Chinese automakers are looking overseas because their home market has weakened, especially for plug-in hybrids. China’s EV sales fell 13% through September, while gasoline-car sales also dropped sharply. Rather than cutting production, automakers have kept production steady and sent more vehicles abroad.

The export push is visible in the data. China’s new energy vehicle passenger-car exports reached a monthly record of 558,000 in September. Domestic EV sales totaled 1.11 million that month, down 18% year over year. PHEV sales were down 25% through September, compared with a 6% decline for BEVs.

Growth is spreading beyond China, Europe, and North America. Those other markets sold around 310,000 EVs in September, up 81% year over year. Through September, they bought 2.3 million, up 93%. The EU import proposal and lower Chinese export rebate could make this strategy harder next year.

How do government incentives, manufacturing costs, battery technology, and charging infrastructure influence whether people choose electric vehicles over gasoline cars?

Government incentives can change the upfront price that shoppers face. The article shows this clearly: buyers rushed to purchase before the US federal $7,500 EV credit expired. That policy timing helped produce an unusually strong September 2025 and a much weaker comparison one year later.

Manufacturing costs also affect prices, while battery technology influences driving range, charging time, durability, and vehicle cost. Better batteries can make electric models more useful and attractive. Charging infrastructure matters because drivers need practical access to electricity, especially for regular or longer trips. These factors work together rather than independently.

The article does not provide figures comparing battery costs, charging networks, or EV prices with gasoline cars. It does show that policy can move demand quickly. It also reports falling gasoline-car sales in China, suggesting weaker EV sales there do not simply mean consumers switched back to gasoline vehicles.

This brief was written by AI from the original reporting and checked by other models. Names, figures and quotes come from the source; read it for full context.