Despite the Dieselgate scandal, diesel-fueled cars are still the most popular in Europe. A trend that is slowly changing, as governments and the public opinion are starting to grasp with their impact on public health.
No other continent has been conquered by diesel to the extent that Europe has. Austria, Italy, Luxembourg, Ireland, Portugal, Sweden and Spain are countries where diesels still dominate even among new cars – they account for over 50 percent of registrations. The figure is only slightly lower in France, Belgium and Greece. By comparison, in the US only three in a hundred passenger cars have a diesel engine.
Where does the popularity of diesel on this side of the Atlantic come from? There are several reasons. First of all: the lower price of diesel oil. Secondly, the lower rate of combustion of diesel engines (an effect of their higher efficiency). Thirdly – a greater supply of diesels in Europe, which were manufactured by German producers especially. Over the past decade, there was a tax advantage for diesel in 17 EU countries, where car taxes were dependent on CO2 emissions (lower in diesel engines). The latter made the use of diesels even cheaper.
And because of this, between 2004 and 2014 as many as 10 million drivers abandoned petrol for diesel in the UK alone. In 2012, the World Health Organization (WHO) report exposed the adverse side of diesel engines. It turned out that they emit 15 percent less CO2, but 4 times more NO2 (a gas ten times more harmful than carbon monoxide) and 20 times more microscopic solids called Particulate matter (PM, which induces cancer development). This made the health costs of diesel fuel ten times higher than that of petrol cars. Since 2012, their sales in Europe began to decline after years of increases.
The fall in the number of diesels was accelerated by the Volkswagen emissions scandal that broke out in the autumn of 2015 (Dieselgate). In order to pass rigorous emission tests in the US, especially in California, 11 million of Volkswagen AG’ cars had software uploaded that detects measurement procedures and reduces the emission of nitrogen oxides (NOx) by up to 40 times for the duration of the tests. The practice, detected by the International Council on Clean Transportation (ICCT), had been in place for six years. After this was given publicity, Volkswagen’s shares fell by a third within a few days, and the firm itself became the target of judicial investigations in many countries.
The scale and notoriety of the scandal have damaged the reputation of diesel. As early as the following year, 2016, diesel sales in Europe fell by 4.1 percent. Who has gained? Hybrids (mainly petrol-electric), amongst others. In the first half of 2017, sales were 54 percent up on the previous year. Electric cars are gaining, year by year, although the effect of a low base is still visible. The exception is Norway, which last year became the first country in the world where more electrical cars and hybrids (52 percent) were sold than internal combustion cars.
Diesels have held on strongly in high end vehicles (82 percent of sales) and in SUVs, although in the latter they will gradually be replaced by hybrid drives. In 2016, 41 percent of all passenger cars on EU roads were diesels, as against 54 percent with petrol engines. The percentage of diesels is highest in Latvia (69 percent), Luxembourg (66 percent) and France (64 percent). Cars fuelled by petrol hold sway in Greece (95 percent), Cyprus (89 percent) and Hungary (73 percent). Poland has twice as many diesels (58 to 28 percent) and the highest percentage of LPG cars – 13.5 percent. In this category, it overtakes Italy (9.6 percent) and Bulgaria (6.8 percent).
Internal combustion cars are still dominant
As many as 95 percent of the 15 million cars registered in Europe in 2016 had internal combustion engines powered by petrol or diesel. Only 177,000 were powered by LPG (propane-butane), CNG (natural gas) or E85 (ethanol). There were 90,795 electrical vehicles registered (up 3 percent on the previous year), 112,999 plug-in hybrids (a 17 percent increase) and 303,506 ordinary hybrids (up 29 percent). In total, 690,000 cars with alternative drive (other than internal combustion only) were registered in Europe, or less than 5 percent of the total. This was, however, 6.5 percent more than a year earlier.
The market for electric cars in Poland is just getting off the ground. In 2016, 164 were sold; along with plug-in hybrids – 556. The number of standard hybrids is growing much faster – in 2016, 10,000 were registered, and in the first half of 2017 – 8,500. And although 64 people bought a Tesla in 2016 (an increase of more than 300 percent), it can be seen that the change from internal combustion cars to zero emission vehicles in Poland will take at least two to three decades.
The pattern of new car sales in Europe
Four to eight percent per year – this has been the rate of growth in the passenger car market in Europe for the past three years. Among the leaders is Poland with double-digit growth (17 percent last year – 483,200 units). A bigger – 20 percent – increase was registered only in the Netherlands.
The Europeans’ favourite make? Volkswagen – 1,696,950 units sold. Favourite model? Golf – this is now its tenth year in top spot. Although in 2017 it saw an 11 percent fall in sales, it maintains a clear lead (25,000 units) over the second-placed model – the Ford Fiesta. The third – just as two years earlier – is the Renault Clio. The fourth, fifth and sixth places are also unchanged. They are taken by Volkswagen Polo, Opel/Vauxhall Corsa and Nissan Qashqai respectively.
The Opel Astra produced in Poland jumped from the 16th in 2015 to the 7th place in 2017 – two years ago it appeared in a completely new version and tempted tens of thousands of new customers. In 2015, the Astra did not figure among the top five best-selling cars in any European country. In 2017, it was there in four: the Netherlands, Finland, Germany and Poland. This is unlike its long-term competitor – the Golf: in 2015 it was in the top five in as many as 11 countries, and in five of them in top position. Today it is the leader in three countries: Austria, Germany and Norway. In contrast, in Denmark, Spain, the Netherlands, Finland and Latvia, the Golf has dropped out of the top five market bestsellers.
Norway is the only country in the world where the best-selling vehicles are electric cars: BMW i3 is in second place (held by the Tesla Model S two years ago) and Nissan Leaf – in the fourth position.
The map of Europe and the local sales leaders show up customers’ national patriotism: Czechs, French, Germans, Swedes and Italians usually choose cars produced in their own countries. Judging by the volume of sales, the latter are more fond of the Fiat Panda than the Germans of the VW Golf. Last year, the Golf accounted for 28.9 percent registrations of all Volkswagens sold in Europe. However, there are marques where one model takes a much larger share in total sales. For example, Lexus with the NX model (40 percent), SsangYong with the Tivoli (53 percent), DS with Model 3 (59 percent), Mini with the eponymous Mini (65 percent), Jeep with the Renegade (74 percent), Alfa Romeo with Giulietta (63 percent), Infiniti with Q30 (60 percent) and the Lancia Ypsilon – the only available model for this marque (100 percent).
Leaders and laggards of the European car industry
In 2016, world production of cars stood at 95 million. Of this, China accounted for one in three (35 percent) and Europe for one in four (24 percent). The European leader is Germany with an output of 5.8 million units. Spain comes next – with 2.4 million units, then the UK with 1.7 million, France – 1.6 million, the Czech Republic – 1.3 million, Slovakia – 1 million, Turkey – 950,000, Italy – 715,000 and Poland 550,000. Hungary, Romania, Belgium, Sweden and Slovenia, Portugal and Austria come behind Poland. As a car manufacturer, Poland takes 21st place in the world and 9th in Europe.
What about sales? Germany produces more cars than Germans buy (3.7 million new registrations, 4th place in the world), conversely to the UK (3.1 million, 6th place) and France (2.5 million, 7th place). In 2016, Poland was the 25th largest car market in the world with a total of 500,000 vehicles. Poland maintains the highest average age of cars the EU rankings (16.6 years old, that is 6 years above the European average) and will remain so until the Central Vehicle Register database is tidied up – for now, it is still full of “dead souls”.
In terms of employment in the automotive industry, Poland ranks behind Germany (250,000 people) and France (178,000 people) with a total of 169,000 employed in the sector. This is slightly less than Poland’s total of miners (171,000) and slightly more than its doctors (164,000). Employment is surprisingly large for a country that does not have its own marque in the passenger car segment.
There has been a significant reshuffle in the market share of different marques over the past 10 years. Between 2006 and 2015, the largest gains in the number of clients in Europe were made by Dacia (a 190 percent increase from 0.9 to 2.6 percent), Porsche (up 150 percent), Jeep and Land Rover (a 100 percent increase), Mini (up 85.7 percent) and Kia (an 80 percent increase).
Alfa Romeo (down 56 percent), Honda (a 50 percent fall), Lancia (dropping 45 percent) and Citroën (33 percent down) recorded the biggest falls.
Where is your car actually made?
People see Toyota and think – Japan. Wrong. Most of the models sold in Poland are manufactured in Europe: Aygo – in the Czech Republic, Avensis – in the UK, Yaris in France, Corolla and C-HR in Turkey. And only the RAV4 model comes from Japan. Turkey builds the Renault Clio, Fiat Tipo and Hyundai i20. The Hyundai i30 is made in the Czech Republic and South Korea. Opel has a big dispersion: the three-door Corsa and Insignia are made in Germany, but the five-door Corsa in Spain, the Mokka X in South Korea, and the Astra in the UK (5-door, Sports Tourer) and Poland (5-door, GTC, sedan). Kia Cee’d and Sportage are made in Slovakia, and Suzuki Vitara in Hungary. Mazda is less cosmopolitan – the majority of models sold in Poland are Japanese.
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