Dutch Car Market Recovering, Osborne Taking Hold

After a difficult 2021, the Dutch car market is recovering. In the first quarter of this year, the electric car market grew to 12,294 registrations, from 4,539 in last year’s Q1. That is a recovery of 171% and a new Q1 record. At the same time, the market for vehicles with a tailpipe declined for the fourth year in a row. This time it declined by only at 13.3%. Total registrations were 2.5% lower than the previous year. What is recovering is the demand for cars, but only modern cars with a future, the fully electric type. The supply for these models is what is lacking.

The market for fossil fuel vehicles is still much larger than the market for zero emission vehicles. The official Crystal Ball watchers are looking at excuses like the corona pandemic, chip shortages, supply line disruptions, the Ukraine war, inflation, possible economic recession, and you name it. None of those excuses can explain why we see five years of decline.

Those industry insiders still do not think the decline of the fossil fuel vehicle (FFV) market can have anything to do with the transition to clean driving. They have difficulty enough to accept that BEVs are replacing FFVs. That the potential sales of future BEVs are lowering current demand for “real” (ICE) cars is something beyond their imagination. The professional market analysts see a decline of only 2.5% in the first quarter and expect a recovery in the rest of the year.

They are wrong. The fossil fuel vehicle market is on the same downward slope that was the domain of diesel-powered cars after dieselgate. There can be an occasional hiccup, but it will slide to zero in another 5 years. Only government intervention can delay the inevitable outcome by a few years.

That intervention is possible, but only as the unintended consequence of another measure. Governments are sometimes quite stupid.

The Dutch market is entering the period in which demand is for future products that are waiting in the wings, aka “the Osborne effect.” OEMs have waited too long to bring these models to market. Some are still trying to protect their current FFV sales by only offering BEVs with limited usability – cars without enough range, with no towing capability, with smallish batteries, and with other deficiencies that show they are not ready for prime time.

The market is starting to understand that electric cars are possible. These cars will be available for competitive prices in the near future. The resale value of a fossil fuel burner that is bought now will go the way of the Dodo.

The Dutch automotive industry expects a recovery to 390,000 registrations across the entire market this year after the disastrous 324,000 of last year. Traditionally, the first quarter is the best quarter for fossil fuel burners. The influence of chip shortages, supply disruptions, and Covid-19 might decline during the year. The influence of the Osborne effect on the car industry will get bigger.

It is unlikely that FFV registrations will match last year’s 260,000 this year. A total of 240,000 registrations is more likely. With BEV sales growing to 100,000 from the 64,000 of last year, this year’s total could reach 340,000, a clear improvement over last year.

Because an article like this is never complete without some models and numbers, the 40 models with the highest registrations are as follows:

Using data from RAI, iserv.nl, and eu-evs.com


 

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