Challenges in 2024 and Solutions for 2025 for the Automotive Industry?
01.10.25 | Blog | By: Philippe Marchand
2024 has been a challenging year for car manufacturing in Europe. New car sales have decreased by 3.2% in France; except for the post-pandemic years (2020 to 2022), 2024 sets a new record for the last thirty years in terms of low sales volumes. With the average price of battery electric vehicles (BEVs) increasing by 3.7% last year, it is no surprise that only 13% of households in need of a new car could afford one. This situation stands in stark contrast to what Henry Wallace might have described in 1950 as typical of the “Common Man’s” expectations in the post-World War II era.
At that time, the U.S. leadership aimed to eradicate the possibility of future wars between major economies by promising prosperity for all—a promise that largely held true for three-quarters of a century. This prosperity was fueled by the exponential use of fossil fuels, primarily refined from crude oil, as shown in the graph below. The graph below reflects energy consumption per capita, which has increased significantly alongside a tripling of the global population since 1950.
Global Primary Energy Consumption by Source
Source: Our World in Data
We have grown accustomed to “prosperity,” a relative concept that varies geographically and socially but has also been embraced by decolonized nations since the 1960s. In the Global South, this notion is sometimes referred to as the “right to development.”
The increasing accumulation of CO2 in the atmosphere is a physical consequence of massive fossil carbon usage and is already negatively impacting the climate. Unfortunately, our scientific knowledge does not allow us to precisely estimate the level of CO2 concentration that would make Earth uninhabitable. However, it is clear that higher concentrations are already causing fatalities and damages, making life increasingly difficult. Despite this, a slowly increasing risk does not seem to drive systemic change, particularly in the realm of road mobility.
BEV-based electromobility is often considered the ultimate solution to decarbonize light-duty vehicle usage. Alternatively, some propose reducing driving altogether. Neither of these options is realistic in the short or near term. Recent inflation and rising inequalities challenge reports of enduring economic growth. Moreover, reductions in public support (such as cash-for-clunkers programs and subsidies for zero-emission vehicles) and the increased cost of borrowing further reduce the Common Man’s ability to afford a new car. Higher-priced vehicles, including EVs, are the most affected. EVs also generate range anxiety—few drivers are willing to spend nearly three hours recharging their batteries to travel just 600 miles. This concern is particularly significant in emerging countries, where investment in charging infrastructure is often not a priority.
Hybrids may provide an interim solution. For drivers in congested urban areas, the higher purchase price compared to equivalent internal combustion engine models may be justified. Hybrids offer silent, low-emission electric travel in cities and lower fuel consumption, thus reducing CO2 emissions by 10-15%, according to the Worldwide Harmonized Light Vehicle Test Procedure (WLTP). In 2024, hybrids gained significant market share in Europe, much to the discontent of eco-radicals and BEV advocates who argue that hybrids’ added weight and continued fossil fuel use make them inferior to BEVs. While car manufacturers classify hybrids as part of electromobility, they are primarily gasoline-powered.
Transitions take time and often require intermediate solutions to achieve mass-market acceptance. If these intermediate solutions become the new standard, they may align with Bjorn Lomborg’s recent predictions about continued fossil fuel usage:
Fossil Fuels as a Percentage of World Energy Usage
Source: Bjorn Lomborg
Or they may not, as achieving Net-Zero by 2050 remains a critical goal. Analysts have identified 2025 as a pivotal year in the fight against climate change. Happy New Year.
Philippe Marchand is a Bioenergy Steering Committee Member of the European Technology and Innovation Platform (ETIP).
