Iran war fuel crisis drives electric vehicle market surge in Europe

Electric vehicle market Europe demand surged across the continent in May as rising fuel prices linked to the Iran war pushed more consumers toward cleaner transport options, industry data shows.

Data from research group New Automotive and E-Mobility Europe reveals EV registrations jumped 34% year-on-year across 17 European markets, which together cover more than 90% of EU and EFTA car sales. Fully electric vehicles now account for nearly one in four new car registrations.

The spike comes after oil flows through the Strait of Hormuz were disrupted, keeping global fuel prices elevated despite a ceasefire agreement between the United States and Iran.

“Consumer interest in EVs is clearly stimulated by low-cost, very good Chinese cars arriving on the market,” said Andy Palmer, former Nissan executive and founder of the original Leaf EV program.

Automakers, however, warn the trend may not last.

Renault reported that its EV order book growth rose by 50% in some countries since the conflict began in late February. But CEO Francois Provost cautioned that demand could weaken if fuel prices fall.

Ford Europe chief Jim Baumbick echoed that concern, saying the war has “increased customers’ interest” but warned against assuming a permanent shift.

At the same time, competition is intensifying. Chinese automakers, including BYD Dolphin G launch Berlin, are expanding aggressively in Europe with lower-cost models aimed at mass-market buyers.

The used car segment is also heating up. Platforms such as OLX reported that sales leads for Chinese brands in France have increased more than fourfold year-on-year. Meanwhile, Danish platform Bilbasen expects used EV resale values Tesla trends to strengthen, with prices projected to rise 10% this year.

Despite earlier price cuts that weakened resale values, used EVs remain cheaper than petrol equivalents in markets like the UK, where they sell for about 33% of original price compared to 52% for combustion vehicles.

Industry analysts say improved charging infrastructure and rising supply of affordable EVs could stabilize demand even if fuel prices ease.

“The market should stabilise,” said Cox Automotive insight director Philip Nothard. “I very much doubt that we’ll see a downturn.”

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