Europe's Affordable EV Wave Is Real, and the UK Is Filling Its Own Shelf

Transport & Environment's latest EV progress report, published on 5 October, is a supply story rather than a sales one. The group's press release says sales of electric cars with a starting price below €25,000 are set to rise sevenfold in 2026 compared with 2024, driven by a doubling in the number of such models on sale.

The pipeline behind that projection is the concrete part. The full report says almost 40 new electric models arrived in the first half of 2026, taking the number of mass-market battery electric cars to more than 150. About 60 new models are expected by the end of the year, nearly four times the average of 15 a year between 2021 and 2025.

The demand has followed. Across the EU, 1.64 million battery electric cars were sold between January and August, 45 per cent more than a year earlier, and electric cars outsold petrol for the first time over a full quarter in the second quarter of 2026.

What is doing the work

T&E credits the EU's CO2 targets on new cars, which push manufacturers to sell more low-emission models across their fleets. The report warns that weakening the 2030 to 2035 targets would halt the ramp-up of small affordable EVs and put European makers' position in the global race at risk. Lucien Mathieu, T&E's cars director, argues the demand was there all along. "European car makers were complaining about the lack of demand for a long time. Now we can clearly see: the issue was not the demand, but what they had to offer," he said, pointing to the Volkswagen ID. Polo, which T&E says drew more than 40,000 orders and a ten-month waitlist.

The report also links the shift to running costs rather than to climate policy alone. It puts the oil price shock at €53 billion for EU road users, notes that a 50-litre tank of diesel costs about €30 more than before the Iran war, and estimates that switching to an electric car at the start of the crisis would have saved around €350 in running costs by mid-September.

One caveat is worth stating plainly. T&E is a campaign group with an interest in the targets surviving, and the sevenfold figure is a projection for a year that has not finished. The model count and the sales data support the direction of travel, but the multiplier is an estimate rather than a result.

The UK does it differently

Britain has not taken the fleet target route to cheaper electric cars. Instead it uses a purchase grant on a shelf capped at £37,000, with two tiers: £3,750 for the lowest-emission cars and £1,500 for those that meet basic criteria, as Autocar's running list sets out. The result is a UK affordable shelf that has filled quickly this autumn. Kia's EV2 Long Range lists at £27,995 and comes down to £24,245 after the grant, while the Fiat 500e runs from £20,995 to £17,245.

The list itself is now long enough to work as a shopping guide rather than a curiosity, and the qualifying trim is often the one a buyer would have chosen anyway. The lower £1,500 tier covers cars that miss the top sustainability criteria, so most of the affordable shelf is covered at one level or another.

The newest arrival shows how far the entry price has fallen. Hyundai opened UK orders for the IONIQ 3 on 5 October with the full £3,750 grant on every version, taking the entry Advance 42kWh to £18,495 and the 61kWh model, which Hyundai quotes at up to 308 miles of range, to £21,995. We covered the launch in our piece on the IONIQ 3 order book, and the framework itself in our autumn update on the scheme.

Different levers, similar result

It helps to be precise about the difference. The EU mechanism is a regulatory push that pulls cheap models into production across a whole industry, while the UK mechanism is a subsidy that makes specific cars cheaper for buyers here. Neither is copying the other, and the two are pulling in the same direction by different means. The UK also runs its own supply-side rules through the ZEV mandate, and the arithmetic behind those targets is what our half-year review of the mandate examined in September.

For anyone shopping now, the practical point is simpler than the policy argument. The number of genuinely affordable electric cars on UK forecourts has grown from a handful to a proper choice over the past year, and the grant, where it applies, sharpens the price. The sub-€25,000 wave T&E describes is arriving here as a sub-£25,000 shelf, and the models keep coming.

The two systems also stop in different places, which is the part worth holding on to. An EU fleet target applies across every car a manufacturer sells, so it changes what gets designed in the first place. A UK grant applies at the till, so it changes what a buyer pays for a car that already exists. The first shapes products a few years out, the second moves sales in the current quarter.

What is doing the work

The UK does it differently

Different levers, similar result

Sources