The 10 events that marked 2023 in the automotive world

From 2035 emissions to Euro 7 via the electric car price war.

By: Massimo Grassi

Dec 31, 2023 at 7:00am ET

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End of the year. Time to take stock. As far as the automotive 2023 industry is concerned, looking back, there are many events that have marked the last 365 days, between political and product issues. Looking at Europe, the main theme was 2035 and the goal of abandoning petrol and diesel engines for good, forcing manufacturers to sell only and exclusively electric cars.

Manufacturer's plans are moving in this direction, although between inflation and market uncertainties, not all are taking off. In the midst of all this is the price war initiated by Tesla, with discounts that have led many other manufacturers to follow suit. Now we wait in anticipation of the arrival of cheap models in just over a year's time.

From here, we would like to summarise the year that is now coming to an end, reviewing the 10 events that marked 2023 in the automotive world.

The question of 2035
Euro 7? No, a modified Euro 6
Europe versus China
More cars sold
Electric cars in peace and quiet
Strike after strike
Low-cost electric cars arrive
The price war
The best-seller you don't expect
The car in Spain

The question of 2035

The decision had already been taken in 2022, not without (even fierce) criticism from governments and car manufacturers. But at the end of March 2023, the decision was made: from 1 January 2035, European motorists will no longer be able to buy new petrol or diesel cars.

All in favour of electric ? Not exactly: the European Council opened the door to the marketing of e-fuel models.

Now the ball passes to the European Commission, whose task is to prepare a text defining how synthetic fuels will be used from 2035 onwards.

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Euro 7? No, modified Euro 6

Another hot topic on the table for European politicians: Euro 7, i.e. the emissions standard to be met by all new cars marketed in Europe, a standard considered too strict by many (manufacturers and national administrations).

In fact, the Euro 6 currently in force will be maintained for a long time to come, with changes not so much on the quantity of emissions but on which ones will be taken into consideration. For cars, the number of exhaust particles will be measured at the PN10 level instead of the current PN23, thus taking into account the smallest particles.

Europe versus China

More politics, but this time looking beyond its borders. The bone of contention: the prices of Chinese cars, often much lower than those of competitors produced in Europe. According to the European Commission, the Chinese government is behind this, with subsidies and tax breaks.

More cars are sold

With an increase of 6.0% compared to the same month in 2022 in November 2023 the European car market reached its 16th consecutive month of growth. Looking at the first 11 months of the year only Hungary and Norway have the minus sign in front, while the others are growing: Germany with +11.4%, France with +16.2%, Spain with +17.3%, Italy with +20.0% and the UK with +18.6%.

This trend is too long-lasting to speak of a post-pandemic upturn, but the future remains uncertain. While it is true that electric vehicles have definitely overtaken diesel in terms of market share (17% compared to 10.6% in November), the energy transition is still scary.

Electric cars with a sense of calm

The latest example is Audi, whose new CEO, Gernot Dollner, said: "We originally assumed that we would reach certain yields by the middle of the decade. Now, given the current situation, those predictions are likely to come true later".

The profitability of electric cars is still a long way off. Or rather, it is far from reaching that of classic combustion models. For Ingolstadt (and beyond) the crux of the matter revolves around the high costs of raw materials and batteries.

Strike after strike

Shawn Fain and Magdalena Andersson. These names are probably unfamiliar to most people. But try asking around the car factories in the US and Sweden. Everyone knows them. The former is the leader of the UAW (United Auto Workers) and the latter is the head of IF Metall (Swedish metal workers' union). Both led strikes that will go down in history.

Fain was the strike leader at Ford, General Motors and Stellantis assembly lines in the US and, after weeks of strike action, won better contracts. Andersson led the Swedish workers' revolt against Tesla, guilty of never having signed a collective bargaining agreement to define hours, wages, benefits, etc. IF Metal was joined by numerous unions, including from outside Sweden. There are no factories in the Scandinavian country, but Elon Musk's company is well represented in logistics and workshops. The tug-of-war continues and the feeling is that the workers will not give up any time soon.

Low-cost electric cars are coming

The first was the Dacia Spring, an electric car for less than €20,000 (€19,590 to be exact) and the cheapest battery-powered model on the market. An urban model, of course, with a reduced range but enough to satisfy the daily commute. Numerous competitors will arrive in 2025, many of them already announced.

From the Citroën C3 to the Volkswagen ID. 2, via the Tesla Model 2, the Renault 5, the Twingo revival and the new Fiat Panda, which will arrive in 2024. So there will be numerous models priced below the psychological threshold of €25,000 (approx. £22,000). The common features will be lengths of around 4 metres, more or less extended range and not much space on board. Will they succeed in convincing motorists to go electric?

The price war

It was the prices of electric cars in China that went down, but it all goes back to Tesla's price lists, which were reduced by up to 9%. From there, several Eastern manufacturers followed Musk's lead. The result? By April 2023, 20% of cars in the Chinese market had reduced their list prices by at least 10,000 yuan, or about €1,300 (£1,130).

Reduction after reduction led in July to a "peace" between manufacturers in what is the world's largest car market. Tesla and BYD emerged victorious from the fray, with record sales in the first half of 2023. For now, there is calm, but it is not certain that a new confrontation will not begin.

The best-seller you don't expect

Never before has an electric car taken home the title of best-selling model in a single year in Europe. That's why 2023 could go down in history. In 11 months, no one has done better than the Tesla Model Y in Europe, closely followed by the Dacia Sandero.

Musk's mid-size SUV has won over motorist after motorist and, despite some problems at the gigafactory outside Berlin, has climbed to the top step of the podium in February, March, May, June, August and September, the other months (except June with the Volkswagen T-Roc) saw the Sandero in the lead. How will the year end?

The car in Spain

We close this list by looking at Spain and the domestic market. The data has been good. So far there has not been a single month of the current year in the negative compared to 2022. So despite the rise in prices, the numbers are more similar to pre-pandemic numbers.

Another fact that is reflected in the Spanish market is the arrival of Chinese brands. The MG ZS is the sixth best-selling car of the year, despite the fact that it started appearing in these lists after the first four months of the year. However, it has been very popular in the Spanish market, as it has become the sales leader in Spain in August and September.

Finally, we know that the transition to electric cars is slowing down in Spain and this is reflected in the fact that no electric car is among the best-selling cars of the year, although we do see a significant change in sales of diesel and electric cars.

Sales of diesel engines have decreased by 13.9% while petrol and other vehicles have increased by 15.1% and 31.9% respectively. Will we see in 2024 any 100% electric vehicle among the best sellers of the year?

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