With the EU car market expected to shrink by over a quarter this year compared to pre-pandemic 2019 levels, the European Automobile Manufacturers’ Association (Acea ) is calling for a policy framework that enables the market to both recover and make the shift to zero-emissions.

“To ensure a return to growth – with an even greater share of electric vehicle sales so climate targets can be met – we urgently need the right framework conditions to be put in place,” said ACEA President and CEO of BMW , Oliver Zipse, during an ACEA reception last night.

“These include greater resilience in Europe’s supply chains, an EU Critical Raw Materials Act that ensures strategic access to the raw materials needed for e-mobility, and an accelerated roll-out of charging infrastructure.”

“The last years have been marked by major events like Brexit, the coronavirus pandemic, semiconductor supply bottlenecks and the war in Ukraine, with its impact on prices and availability of energy,” Zipse continued. “All of these things underline how quickly, how profoundly and how unpredictably our world is changing. This applies not least in the geopolitical context – where there are direct consequences for our globally interconnected industry and its close-knit value chains.”

EU car sales for the eight months into 2022 show that overall volumes contracted by almost 12% to reach some 6 million new cars sold. ACEA points out that the market this year has been constrained on the supply side as ongoing component shortages constrained production volumes. However, it warns that demand may also suffer over the coming months due to inflation and fears of recession.

With these factors in mind, ACEA has now revised its initial forecast that the EU car market would return to growth in 2022. Instead it expects that it will shrink again this year, slipping by 1% to 9.6 million units. Compared to the 2019 pre-pandemic figures, this represents a drop of 26% in car sales in the space of just three years.

“Despite the contracting market and pressure from inflation and energy costs, the automobile industry continues to invest massively in R&D and in the skills and technologies driving the green and digital transition,” said ACEA’s new Director General, Sigrid de Vries.

“Such a vast transformation can only be successfully achieved by an industry that remains competitive well into the future. This is also strongly dependent on the right political framework conditions,” de Vries added.