While growth has slowed compared to the rapid momentum of the past two years, PHEV/EREVs in the Chinese market still maintain double-digit growth this year. By contrast, the European market has been on a downward trend since peaking in 2022. Although sales in the first seven months of this year rose 25.3% year-on-year, longterm growth remains lackluster.
Compared with China, Europe’s PHEV growth is significantly affected by policy differences. China maintains market momentum post-subsidy via phased purchase tax reductions and enterprise dual-credit policies; Europe has scattered policies, tighter subsidies, technical barriers, uncoordinated tax and enterprise incentives, weak local benefits, and policy uncertainty. These factors restrict its growth pace and deprive it of the sustained drive seen in China.
Based on Comparative Analysis of Public and Expert Perceptions of Electrified Vehicles in the European Union, Europe’s overall attitude toward PHEVs is mostly neutral: the public (35% positive) sees them as a mature transitional technology to ease range anxiety, while transport experts (29% positive) are more cautious about flaws such as limited range and poor charging experience. This contrast highlights a divided between “public expectation and expert caution”.
Benefiting from technological advantages (in driving range, intelligence, and cost-efficiency), Chinese-branded PHEVs have emerged as a sudden force in the European market. Their sales share in Europe’s PHEV market has risen from around 10% to approximately 28% as of 2025. As more Chinese PHEV products enter the European market, this trend is likely to impact the development of Europe’s PHEV sector.
Comprehensive analysis shows that in the European market, PHEVs will maintain moderate growth in the short term from 2025 to 2027, with sales expected to peak in 2027. In the long run, however, PHEV sales will start to decline starting in 2028, and they will begin to lose market share to BEVs.
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