Market Trends of Europe Mild Hybrid Vehicles Industry
The Passenger Cars Segment is Anticipated to Dominate the Market
Over the long term, growing demand for alternative drive options other than traditional internal combustion engines, rising fuel prices, and strict rules set by governments in various European countries are expected to drive the demand for passenger cars.
Sales of passenger cars are high in the European automotive market due to their stylish design, compact size, and economic value. These cars are also considered the most common mode of transportation. Therefore, the growing demand for cars with advanced features and high fuel efficiency contributes to the market’s growth.
According to the European Automobile Manufacturing Association, the registration of new passenger cars in January 2024 reached 8,51,690 units, 12.7% higher than January 2023. Thus, an increase in the sales of passenger cars plays a very important role in the growth of the overall market.
Mild hybrid systems offer significant advantages, including smooth engine start-up, kinetic energy-based battery charging, and the ability to cover short distances on electric power, all contributing to reduced overall fuel consumption. They have strong appeal among consumers seeking low-emission passenger cars, aligning with the rising popularity of mild hybrid vehicles.
Additionally, the cost-effectiveness of mild hybrid vehicles, attributed to their less sophisticated design compared to full hybrid counterparts, makes them a financially viable option for consumers.
Considering the growth of passenger car sales with fuel-efficient engines, OEM companies are taking advantage of this trend to drive the market for mild hybrid vehicles. For example,
In November 2023, Jeep expanded its Avenger SUV lineup by introducing the mild-hybrid powertrain-based Avenger e-Hybrid. The Avenger e-Hybrid is a 48-volt mild-hybrid system featuring a 21 kW electric motor integrated into the SUV's gearbox, offering low-speed EV-only driving for up to 1 km.
However, while the rising sales of all-electric vehicle models in countries like the United Kingdom, Germany, and France pose a potential challenge for the passenger cars segment, mild hybrid cars will likely continue their steady growth driven by their cost and fuel efficiency.
Germany is Expected to Hold the Highest Market Share
Consumers in Germany are highly receptive to mild hybrid vehicles due to the adoption of eco-friendly vehicles and the government’s focus on promoting sustainable vehicles, contributing to market growth.
Germany is also famous for various car championships, such as the MXGP Championship, thus boosting the demand for high-performance cars in the country. Automakers are launching engine technologies that offer high performance and are sustainable.
In June 2023, RAM extended its portfolio lineup with the introduction of the 3.6-liter Pentastar V-6 with an eTorque mild-hybrid system, with plans to lower CO2 emissions. The powerful and high-performing engine, which delivers 305 horsepower and 364 Nm of torque, is available in Europe on the RAM 1500 Big Horn, RAM 1500 Laramie, and RAM 1500 Rebel models.
Mild hybrid SUVs have become increasingly popular, especially the models that are particularly well-received in Germany. These vehicles combine the advantages of electric and combustion engines, resulting in impressive performance and environmental compatibility. Despite higher acquisition costs and more complex maintenance, these vehicles act as an attractive option, offering fuel efficiency, driving comfort, and lower emissions.
According to the Center for Automotive Research, more than half of new cars sold in Germany in 2025 will be SUVs, thus boosting the demand rapidly and contributing to the market’s growth.
The rising development of mild hybrid SUVs integrated with high-end technologies, such as eTorque mild hybrid systems, is projected to offer lucrative growth opportunities for market players.
Considering the sales growth of SUVs, companies are also focusing on the launch of new models to gain a competitive edge over the market. For instance, in March 2024, German automaker Mercedes revealed its G-class SUV model with mild hybrid systems, which will be launched in 2025.
The government’s increasing focus on cutting subsidies on electric vehicles by 2025 is expected to promote the sales of mild hybrid vehicles as they also offer better fuel efficiency compared to electric vehicles. However, the total cost of ownership will be much lower than that of electric vehicles in the long run.
Thus, such factors, coupled with various new technological advancements, will have a positive impact on the market.
