The European automotive landscape is undergoing a profound transformation. Behind a seemingly modest 4.1% growth in July 2026 lies a story of rapid evolution. Preliminary data from Dataforce, covering 98% of registrations across the EU, UK, Iceland, Norway, and Switzerland, reveals a 5.7% increase in the first seven months of the year. The driving forces behind this shift are electric vehicles (EVs) and Chinese automakers.
The EV sector witnessed a remarkable 51% surge in July, capturing a quarter of the market. This means one in every four new cars sold in Europe is now electric. The year-to-date growth stands at 37%, bolstered by rising fuel prices following the Middle East conflict that began in late February. Other electrified vehicles also saw gains, albeit at a slower pace. Plug-in hybrids rose by 15% in July, with a 24% increase since January. Full hybrids climbed by 9%, slightly behind their 14% year-to-date growth.
Chinese Brands Make Waves in European Auto Market
The second major development comes from China. Chinese brands achieved an 11.2% market share in July, with sales more than doubling compared to the same month in 2026. This translates to over one in ten new cars sold in Europe bearing a Chinese brand. BYD leads the pack, followed by Chery and SAIC, the parent company of MG. However, the most impressive growth rates belong to Leapmotor, a Stellantis partner, which saw a 294% increase to 9,306 units, and Xpeng, with a 270% rise to 5,244 units. Chery, including Omoda and Jaecoo, grew by 202%, while BYD, along with its premium brand Denza, saw a 150% increase.
Geely Group also made significant strides, with a 21% increase in sales. The Geely brand itself experienced a remarkable jump from 168 units in July 2026 to 4,508 units in the same month of 2026. Changan saw a substantial increase from 7 to 1,249 units, while Chery’s sales soared from 107 to 5,868 units. In contrast, many traditional European and non-Chinese brands struggled. Mercedes-Benz grew by 4.7%, while Toyota, Stellantis, and BMW Group saw modest increases of 2.3%, 2%, and 1.7%, respectively. Ford, Hyundai-Kia, Nissan, and the Volkswagen Group faced declines of 16%, 8.5%, 5.8%, and 3%, respectively. Tesla also experienced a 36% drop, although this is partly due to its typical weak delivery month at the start of each quarter.
European Brands Adapt to Changing Market Dynamics
Some European brands are adapting to the changing market dynamics. Fiat, Citroën, and Renault saw growth rates of 25%, 16%, and 11%, respectively. Fiat and Citroën benefited from new models based on Stellantis’ Smart Car platform, while Renault’s focus on small electric vehicles is paying off. The best-selling car in Europe for July was the Dacia Sandero, followed by the Volkswagen Golf and T-Roc. Notably, the Mercedes-Benz GLC, with a 45% increase in sales, secured the seventh position
The electric vehicle segment is particularly dynamic. The Renault 5 E-Tech emerged as the third best-selling BEV in Europe, with a 49% increase in sales. The new Renault Twingo also made a strong debut, with 4,831 units sold in its first month, placing it just behind the Tesla Model Y in the electric vehicle rankings.
