Electric vehicles: Why the French market is the place for you

14 Jan 2021
Estimated reading time : 6 minutes
Electric vehicles: Why the French market is the place for you
14 Jan 2021
Estimated reading time : 6 minutes

While the French auto industry has been hit by the Covid-19 crisis, the electric vehicle (EV) segment is thriving.

Between January and July of 2020, EV sales in France were up 128% over 2019, and electric cars accounted for nearly 18% of new-car registrations in the first seven months of 2020.

Is France the new Promised Land for electric vehicles? And what can the French market offer you?


Fast-growing European market


Market trends differ widely in Europe, China and North America

In the first half of 2020, global sales of electric and rechargeable hybrid vehicles were up 4.1% from the first half of 2019. This stood in stark contrast to the auto market as a whole, which fell 26% worldwide.

And despite the Covid-19 crisis and its economic fallout, electric vehicles have continued on their decade-long growth trajectory.

Yet market trends vary widely from region to region. Between January and June 2020, Europe took the lead, with 42% growth and over 401,000 vehicles sold.

Over the same period, electric vehicles accounted for an estimated 8% of European market share, up from 3.5% in the first half of 2019.

With this strong showing, Europe has now outstripped China, formerly the world’s biggest seller of electric vehicles, with 360,000 units sold, and has significantly outperformed the United States, with only 128,000 vehicles sold.

Chinese and US markets began flagging in the second half of 2019 as subsidies were modified and phased out.

By contrast, the European market has been buoyed by incentive programs and policies that promote the ecological transition.

And the trend is likely to continue. Forecasts call for strong sales growth between 2019 and 2025, as new models are rolled out.

The number of electric vehicles produced in Europe should increase sixfold between 2019 and 2025, rising to over 20% of the EU’s automotive output.


France a leading contender in electric vehicles

EV sales have risen steadily in France since the early 2010s, and results from the first half of 2020 are very encouraging.

Despite the challenging economy, performance has significantly outpaced results for 2019.

Support from the French State—a green bonus and incentives to make the switch to electric vehicles—are stoking demand, but the market has also been energized by growth in supply.

The Renault Zoé is a case in point: it’s now France’s third-best-selling car for all power categories combined.


Advantages of the French EV market


Favorable regulatory environment

The French market is strengthened by European regulations designed to advance the electric transition.

Since January 1, 2020, carmakers have been required to meet EU targets for CO2 emissions. Average emissions for each manufacturer’s fleet of European-registered vehicles are limited to 95 g CO2/km, with stiff financial penalties for those who fail to comply.

As carmakers update their lines to meet these targets, the number of electric models will skyrocket between 2020 and 2025, and as noted, this new offer is accompanied by government efforts to boost demand.


A leader in electric battery production

But favorable regulations aren’t the only reason for the growth in Europe’s EV offer: lithium battery factories are springing up across the continent.

Around a dozen plants are being built, increasing production capacity within the European automotive industry and ending its dependence on imports, primarily from China.

In France, we’re particularly committed to electric battery production. Nersac, a French town northeast of Bordeaux, is home to Europe’s first battery factory—a pilot set to begin production in mid-2021. France will also take a leading role in an Airbus-style European battery venture led by PSA and Total’s subsidiary Saft. And plans for a gigafactory in Douvrin, a town southwest of Lille, have now been confirmed, with production expected to begin in 2023.

Together, the facilities in Nersac and Douvrin should make a million electric batteries between now and 2030, or 10%-15% of the European market.


Strong automotive culture

France was an automotive pioneer and has a strong automaking culture.

Today the French industry accounts for:

  • 4,000 companies
  • 400,000 employees
  • €155 billion in sales
  • €49 billion in exports

France also has a tightly-woven automotive ecosystem—a powerful asset in a sector where producers often prefer to locate sites close to consumers.

For EV manufacturers that want to keep supply, production and distribution with easy reach of markets, we’re a destination of choice.

What’s more, French industrial policy favors electric vehicles, with an R&D effort already underway.

The overall goal is to manufacture electric vehicles that perform better and cost less, with a special focus on batteries.

This effort also aims to create an infrastructure that will spur demand for electric vehicles, in particular by working with energy companies to install charging stations.


Hauts-de-France—a strategic destination for EV investments


A leader in the French automotive industry

Hauts-de-France has a strong industrial culture, making it an ideal destination for manufacturing, and since 2016 we’ve been France’s #1 region for foreign industrial investment.

In particular, we’ve attracted major players in the automotive industry, with Peugeot Citroën arriving in Trith-Saint-Léger in 1954, Renault setting up in Maubeuge in 1969, and Toyota starting work on its new site in Onnaing in 1999.

Today, these three world-class carmakers—Renault, PSA Peugeot Citroën and Toyota—operate seven sites in Hauts-de-France.

Hauts-de-France is also France’s #1 automotive region by number of vehicles made, with 700,000 vehicles manufactured annually. We’re also #1 for gearbox production, making 1.3 million units a year.

In all, our region accounts for:

  • 37% of vehicles made in France
  • 40% engines made in France
  • over 50,000 automotive industry employees, including 6,000 in R&D

Learn more about automotive sector in Hauts-de-France

Strategically located at the crossroads of Europe

Hauts-de-France offers an outstanding location in the heart of a massive market with 80 million consumers. And we’re within easy reach of three major European capitals—Paris, London and Brussels.

Because we’re at the crossroads of Europe, Hauts-de-France is also a major player in international trade. In fact, we’re the fifth-largest export region and the second-largest import region in France, thanks to our competitive infrastructures, from maritime facilities to rail to road.


Tightly-woven, high-quality ecosystem

Hauts-de-France is home to 550 automotive equipment manufacturers and subcontractors—a business ecosystem with globally recognized know-how that will help make your investment a success.

The region and its business community also encourage workers to acquire new skills, with special emphasis on training.

In 2013 the industry launched a training center for the rail, automotive and ecomobility industries (Campus ferroviaire, industries automobiles et éco-mobilité), reflecting our commitment to meeting the challenges of tomorrow—and especially the need to convert our automotive fleet to electric power.


Industry insights
Jérôme Bodelle, CEO of CRITT M2A

CRITT M2A is an independent research center in Bruay-La-Buissière, southwest of Lille. We provide R&D testing services to the auto industry in four key areas: powertrains, turbochargers, acoustics and vibration (NVH), and—since 2014—electric vehicle technology.

Our work on EVs includes testing of the entire electric powertrain: cells, modules and electric batteries.

We work with automakers, equipment manufacturers and consulting firms, and we tailor our testing services to each client’s needs, focusing on charging, for example or battery durability.

Clients work with us to:

  • pool skills and resources to move the automotive industry forward in a high-demand market segment
  • anticipate and meet critical auto industry needs
  • develop solutions that benefit the industry in Hauts-de-France and across Europe

In my view, France’s key advantages for the vehicle market are the low cost of electricity (25%-50% less than in Germany, for example) and our tightly-woven ecosystem of automotive SMEs.

That said, French automotive culture is focused largely on heat engines, so we need to invest in training and the energy transition to close the gap with Asia and other competitors.

Our ecosystem—and particularly our pool of R&D experts—plays an important role even though automaker have adopted very different strategies, with some investing in internal R&D and others preferring to outsource.

CRITT M2A offers a comprehensive vision and experience acquired from a wide range of projects. We harness these assets for our clients, working with them to design effective solutions on fairly tight timelines.

Electric charging infrastructures

The Hauts-de-France Regional Council has made electric mobility a priority, investing massively to support sustainability projects in the region and a plan to develop electric mobility.

Hauts-de-France is also running a charging station deployment pilot, working with partners in the French State and at Ademe, the French Environment and Energy Management Agency.

Two companies specializing in charging solutions already have a presence in our region: DBT Group in Brebières and Indelec Mobility in Douai.


With its strong automotive history and sizable investment in converting its fleet to renewable energies, France is well positioned to become the leading destination for the EV market. And as the country’s top automotive region, Hauts-de-France is one of the leaders. Got a development project? The team at Nord France Invest can help.