The European automotive landscape is witnessing a dramatic shift as soaring fuel prices, triggered by ongoing conflict in Iran, propel a surge in demand for electric vehicles (EVs). New data indicates that the spike in petrol pump prices is driving consumers toward both new and second-hand electric models, providing a critical lifeline to an industry that has recently struggled to meet adoption targets.
While fully electric car sales grew by 30% across Europe in 2025, the pace had previously lagged behind industry expectations. This discrepancy led major automakers, including Volkswagen and Fiat-owner Stellantis, to book multi-billion-dollar charges over the last year to cover asset writedowns after investing heavily in an anticipated demand that took longer to materialize.
However, the economic calculus for buyers changed abruptly following US and Israeli airstrikes on Iran at the end of February, which unleashed a wider conflict and caused unprecedented energy supply disruptions. With international oil prices climbing well above $100 a barrel, the cost of internal combustion engines has become a primary pain point for consumers.
Gurjeet Grewal, CEO of UK-based Octopus Electric Vehicles, describes the current trend as an "inflection point" rather than a temporary blip. In April, the company reported a 95% year-on-year increase in demand for new EVs and a staggering 160% rise for used EVs. The United Kingdom, as a net importer of energy, has been particularly vulnerable to the resulting inflation and rising food prices.
Data from research group New Automotive and industry group E-Mobility Europe supports this trend, showing that registrations of new EVs rose 34% year-on-year in April across 16 key markets, representing over 80% of EU and EFTA car sales. While growth remains strong in established markets like Denmark and the Netherlands, there is now significant momentum in regions where EV adoption was previously slow, such as Italy.
Volvo Cars is also feeling the impact. Chief Commercial Officer Erik Severinson noted a rise in orders, particularly for the entry-level EX30 electric SUV, as customers become more sensitive to oil price volatility. Severinsson highlighted that enquiries for fully-electric cars are increasing even in southern European markets where penetration has historically been lower.
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Europe EV sales leap as Iran war pushes up petrol pump prices
cgtn.com
