Electric Vehicle Sales Review Q1-2026

1 Top findings

Top findings

Europe's top five markets delivered a record-breaking quarter, with BEV sales up 36% YoY and BEV market share hitting an all-time Q1 high of 19%
France and Germany led the BEV surge with growth of 50% and 41% respectively, boosted by renewed government purchase incentives
The UK overtook Germany as Europe's largest PHEV market, growing 47% YoY, while PHEV sales across the top five rose 42% year-on-year
China dragged global figures down, with BEV sales falling 20% and PHEV sales plunging 31% YoY, pulling total global EV sales down 10% to 3.5 million units

2 Introduction

Europe leads the charge as global EV growth slows

Europe's electric vehicle market started 2026 with a standout performance, but the headline numbers only tell part of the story.

While global BEV sales dipped by a modest 1% year-on-year in Q1 2026, this figure masks a far more dynamic reality beneath the surface. Across Europe's top five markets, battery electric vehicles (BEVs) surged 36%, capturing a record 19% market share, the highest ever recorded in a first quarter. France and Germany led the charge with growth of 50% and 41% respectively, propelled by renewed government incentives.

Plug-in hybrids (PHEVs) also reached new highs, climbing 42% year over year across the same five markets. The UK overtook Germany as Europe's largest PHEV market, growing 47% year over year, while hybrid sales surpassed one million units for the first time in any quarter, reaching a record 42% market share.

China, however, painted a very different picture. BEV sales fell 20% and PHEVs dropped 31%, pulling global figures into negative territory. As Chinese automakers expand production on European soil, the continent's manufacturers face growing competitive pressure - and policymakers face a difficult choice: protect domestic industry or let competition drive down prices for consumers.

3 Burger benchmark

The burger benchmark as a starting point for comparing global EV prices

The Big Mac Index offers a simple way to compare purchasing power across countries by looking at the price of the same product after currency conversion. As of April 2026, it suggests that general price levels in Germany are roughly 85% higher than in China, with a Big Mac costing €3.18 in China compared to €5.89 in Germany.

While this is only a rough measure, it provides a useful baseline: if EVs in Germany cost about 85% more than in China, the difference likely reflects broader economic conditions. If the gap is significantly larger or smaller, other factors are at play.

Unlike a burger, a vehicle is a heavily traded and regulated product. Its final price is shaped by far more than local cost levels, including:

1
VAT and consumption taxes
2
Customs duties and import tariffs
3
Trade-defense measures (e.g., anti-subsidy duties)
4
OEM pricing strategy and dealer discounts

This means that when German and Chinese EV prices differ by more or less than the 85% Big Mac benchmark, the gap likely reflects sector-specific trade and pricing effects, not just economy-wide cost differences.

Four pricing scenarios

To account for this complexity, our analysis examines four distinct scenarios based on where a vehicle is produced and where it is sold:

Scenario	Description	Key statutory charges
A	Produced and sold in Germany	Net price × 1.19 (19% VAT)
B	Produced and sold in China	Net price × 1.13 (13% VAT, 0% consumption tax)
C	Produced in Germany, sold in China	+15% customs duty, 0% consumption tax, ×1.13 VAT
D	Produced in China, sold in Germany	+10% import duty + trade-defense duty, ×1.19 VAT

Each scenario carries different statutory charges that directly impact the final list price, making direct cross-market comparisons far more nuanced than a simple burger-to-burger comparison.

4 Data

Electric vehicle sales data

France, Germany, Italy, Spain, and UK
The top five European markets enjoyed a bumper Q1 2026, with overall BEV unit sales the highest on record in any one quarter and now approaching the half-a-million mark. Indeed, BEV sales grew by more than a third (36%) vs. Q1 2025 to reach a market share of 19%, higher than any previous first quarter of the year.

The BEV markets in France and Germany benefited from the extension or reintroduction of purchase incentives, up by 50% and 41%, respectively vs. Q1 2025. BEV market share in France (28%) was by some distance the highest among the five markets, while Germany was strongest in terms of unit sales for the fourth successive quarter.

The BEV markets in Spain and Italy have for years lagged far behind the others in the top five. However, both markets continued their steep ascent over recent quarters, up in Q1 2026 by 42% and 66%, respectively year on year. Although their BEV market shares were small relative to the other top five countries (9% and 8%, respectively), these figures have doubled since Q1 2023.

Other European markets
The highest year-on-year BEV growth in the other European^* markets was recorded in Poland (73%), albeit from a very low base. The Danish BEV market also grew strongly, up by 43% in Q1 YoY. Its BEV market share of 79% is the only one to come close to that in Norway, where BEV dominance is almost total (98%).

^{* EU27+UK+EFTA}

China
BEV sales were down 20% year on year in Q1 2026, falling to the lower number of registrations since the first quarter of 2024. The decline can be attributed to a reduction in incentives at the end of 2025 – the phasing out of the full NEV tax exemption and the revision of the car trade-in subsidy scheme, which moved from fixed-amount rebates to a percentage-based, tiered system. .However, we are starting to witness the first signs of an uptick in BEV sales after the pull-ahead effect at the end of 2025 when consumers rushed to take advantage of higher incentives while still available

Japan
A boost in incentives lifted BEV sales in Japan in the first quarter, up by 173% year on year. However, the rise started from a very low base, and BEV market share is still at just 3%. The hybrid market continues to dominate, with a share of 64% in Q1 2026, despite three consecutive quarters of YoY declines.

South Korea
Supported by an increase in purchase subsidies, BEV sales grew very sharply in the first quarter, up by 153% compared to the same period in 2025. BEV market share of 21% was the highest on record. Meanwhile, hybrid market share reached 34%, although sales growth slowed to 7% year on year.

The termination of EV tax credits at the end of September 2025 had a significant impact on sales in the last quarter of the year. Although BEV and PHEV sales in Q1 2026 were still suffering from the disappearance of this incentive, down by 23% and 53%, respectively year on year, unit sales for both categories were up marginally from Q4 2025. BEV market share is at 6%.

The hybrid market, on the other hand, continued its steady growth in the first quarter, up by 8% year on year. Indeed, the hybrid market reached its highest ever quarterly share, at 14%. The fact that this market share has more than doubled in three years since Q1 2023 suggests that consumers are gradually embracing electrification, viewing hybrids as a practical first step in this transition.