In 2025, global electric vehicle sales exceeded 20.7 million units, and Europe emerged as the fastest-growing market.

In 2025, the global electric vehicle market demonstrated resilience amidst multiple headwinds. A report released by market research firm Rho Motion shows that despite policy fluctuations, economic uncertainties, and intense competition, the global sales of electric vehicles (including passenger cars and light - duty vehicles) reached a record high of 20.7 million units, a year - on - year increase of 20%. This indicates that the global wave of electrification transformation has not subsided. Instead, it has entered a more complex and profound new stage amidst structural adjustments and regional differentiation.

"Just a year ago, hardly anyone could have foreseen that the market turmoil would reshape the landscape so drastically," commented Charles Lester, a data manager at Rho Motion. "The 20% growth in global sales in 2025 itself proves its inherent strong momentum."

Europe: The "Dark Horse" Driven by Policies, Winning the Growth Championship

In 2025, the European market became the fastest - growing major region globally, with sales of 4.3 million units and a year - on - year growth rate of 33%, far exceeding expectations. The German market led the way with a staggering growth rate of 48%. The UK market had a steady growth of 27%. The French market was sluggish at the beginning of the year but recovered at the end of the year after the government strengthened subsidies, ultimately achieving a slight increase of 2%.

The sales growth was mainly attributed to three factors. Firstly, although the EU relaxed some transitional requirements for the 2035 ultimate goal, the pressure of average carbon emission regulations from 2025 - 2027 still existed, forcing mainstream automakers to continuously launch electric vehicle models and promote sales. Secondly, several key countries such as Germany, the UK, and Sweden extended or expanded consumer car - purchase subsidies in 2025, directly stimulating demand. Finally, after years of preparation, the product lines of local electric vehicles in Europe have become increasingly rich, and consumer acceptance has significantly improved.

The report predicts that since automakers still need to meet the emission standards from 2025 - 2027 and many countries (such as France and Germany) have announced subsidy continuation plans for low - and middle - income families, the European market will still maintain a steady growth of 14% in 2026.

China: A "Two - Sided Battlefield" of Intense Domestic Competition and Fierce Overseas Expansion

As the world's largest market, China's electric vehicle sales reached 12.9 million units in 2025, a year - on - year increase of 17%. Although the growth rate slowed down compared to previous years, it showed distinct characteristics of both "intense domestic competition" and "overseas expansion".

In the first half of 2025, the sales of electric vehicles increased by 33% year - on - year, and the growth rate slowed down in the second half. Part of the reason is that the "trade - in" subsidy launched in mid - 2024 significantly boosted sales at that time, creating a high base. The growth momentum in 2025 mainly came from fierce price wars and an expanded vehicle model supply.

The squeezed domestic profit margins forced Chinese automakers to accelerate globalization. BYD is a typical example. Its electric vehicle exports soared from 400,000 units in 2024 to over 1 million units in 2025, more than doubling. These exports were mainly directed to Europe (occupying 19% of the local market share), Southeast Asia, South America, and Central Asia, becoming a non - negligible force driving the global growth of electric vehicle sales.

In 2026, the Chinese market will face a new policy environment. The full exemption of vehicle purchase tax for electric vehicles, which has been implemented for many years, will be changed to a 50% reduction; the new "trade - in" subsidy will be linked to the vehicle price rather than a fixed amount. These changes may affect the market demand structure.

North America: A "Receding Tide" Amidst Sudden Policy Changes, with the Market Shrinking for the First Time

In sharp contrast to Europe and China, the North American market encountered a cold spell in 2025. Total sales declined by 4% to 1.8 million units, making it the only contracting region among the world's major markets.

The drastic changes in the US market were the main cause. A series of policy adjustments this year severely hit market confidence: the federal electric vehicle tax credit was cancelled; the fines for the Corporate Average Fuel Economy (CAFE) standards were set to zero; trade - protectionist policies aimed at localizing the supply chain, significantly weakening the market's development momentum.

The policy changes led to alternating "rush - buying tides" and "sudden cooling periods". From August to September 2025, US electric vehicle sales set consecutive records as consumers rushed to catch the "last bus" of the policies. However, sales plummeted by 49% quarter - on - quarter in the fourth quarter, and the market cooled down rapidly. In Canada, sales decreased by 41% year - on - year due to the reduction of subsidies, while Mexico achieved a 29% growth due to a surge in imports of Chinese electric vehicles.

Facing the difficulties, US automakers significantly adjusted their strategies. Stellantis, Ford, and others shifted their resources to the research and development of extended - range electric vehicles to meet the preferences of North American users for long - range and large - sized vehicles and reduce their dependence on charging networks. The report pessimistically predicts that the outlook for the US electric vehicle market in 2026 remains weak, and sales may further decline by 29%.

Rest of the World: A "New Blue Ocean" Driven by Chinese Brands

In 2025, the rest of the world showed the highest growth elasticity, with sales soaring by 48% to 1.7 million units, becoming a new highlight in the industry. The growth of regional sales was almost entirely driven by exports from Chinese brands. In Southeast Asia, the monthly sales of electric vehicles increased from an average of 32,000 units in the second half of 2024 to over 55,000 units at the end of 2025. In South America and Central America, sales increased by 49% year - on - year, and Chinese brands accounted for over 85% of the electric vehicle sales in this region.

In addition, due to the strong position of hybrid vehicles in the Japanese market, the penetration rate of electric vehicles has long hovered around 3%, and electric vehicle sales only increased by 6% year - on - year in 2025. The South Korean market achieved a remarkable growth of 50% under the impetus of new models and government incentives.

Rho Motion's report outlines a picture full of challenges and opportunities for the global electric vehicle market in 2026: Europe will enter a period of observing the policy effects, and growth will tend to be stable; North America may struggle to find a way forward in the "new normal" without strong federal incentives, and the success of local production and extended - range vehicle models will determine the market bottom; the Chinese market will continue to undergo in - depth integration as policies are phased out, with intense domestic competition and accelerated overseas expansion happening simultaneously; the global supply chain will pay more attention to geopolitical risks, and regional and diversified layouts will become an inevitable choice.

The reversal in Europe, the adjustment in North America, the two - front battle in China, and the explosion in emerging markets together constitute a new map of the global electric vehicle industry. In the future, the market will no longer have a single growth narrative. Instead, it will evolve into a diverse future of electric mobility in different corners of the world, depending on different policy environments, infrastructure levels, and consumer preferences.

This article is from the WeChat official account "Automotive Market Insights", author: Zheng Li. It is published by 36Kr with authorization.