Electric Vehicle Sales slow in Switzerland

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Entering 2024, Switzerland stands at a pivotal juncture in its journey toward electric vehicles, characterized by a convergence of decelerating sales growth and the commencement of new taxation measures.

Sluggish Electric Car Sales: Overcoming Hurdles

In 2023, electric vehicles accounted for one in five cars sold in Switzerland, constituting 20.9% of the market. Despite a continued uptrend in electric vehicle sales, the pace of growth moderated compared to the preceding year, signaling a departure from the previously observed rapid trajectory.

Between the conclusion of 2022 and 2023, the market share of electric cars ascended from 17.3% to 20.9%, with plug-in hybrids experiencing a more modest increase from 8% to 9.2%. Swiss eMobility statistics reveal that 30.1% of new car sales belonged to the electric category, illustrating a market in transition.

However, amid this growth, challenges emerge. The share of gasoline vehicles declined from 37.8% in 2022 to 33.3% in 2023, while that of diesel vehicles slipped from 11.7% to 9.3%. The sluggish development is partially attributed to the scarcity of home charging stations. Swiss eMobility underscored this issue, pointing out the potential for landlords to hinder tenants from installing recharge stations.

Despite boasting approximately 17,000 public charging points—a notable increase from the previous year—Switzerland, known for having one of the densest charging networks globally, faces calls for more private charging stations and increased commitment from public authorities. Swiss eMobility expresses concerns about trailing behind neighboring countries, emphasizing the necessity for robust infrastructure to propel electrification.

Taxation Challenges for Electric Vehicles

In a surprising shift, the Swiss Federal Council announces a paradigm shift in its approach to taxing electric vehicles. Effective January 1, 2024, electric vehicles will no longer enjoy exemption status from the 4% tax imposed on imported cars. This reversal of a tax exemption initiated in 1997, aimed at encouraging electric car adoption, reflects the belief that the market has matured sufficiently to justify fair taxation.

The Federal Council argues that electric cars, akin to their gasoline and diesel counterparts, utilize roads and should contribute to financing road infrastructure. Additionally, the government seeks ways to reduce the federal deficit, estimating that the elimination of the exemption will generate between 2 and 3 billion Swiss francs from 2024 to 2030. This decision follows previous instances where the Federal Council modified rules in sectors, such as the Federal Gambling Act affecting Swiss sports betting in 2019.

While symbolizing the increasing standardization of electric vehicles, this decision acknowledges the surging popularity of electric vehicles in Switzerland. In 2018, only 8,000 electric vehicles were imported, but by 2022, this number soared to 45,000, marking a six-fold increase in just four years.

As Switzerland grapples with the dual challenges of slowing EV sales growth and impending EV taxation, 2024 emerges as a formidable year. Striking the right balance between encouraging adoption and ensuring sustainable infrastructure financing will be pivotal for the evolution of electric mobility in Switzerland. The unfolding dynamics will shape the future of electric vehicles on Swiss roads in the coming years.

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