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Norway Leads the World in Electric Car Market Share

Jan. 6, 2016
Generous tax incentives contributed to 17.1% of new car buyers in Norway choosing electric last year, up from 12.5% in 2014.

OSLO, Norway—Electric cars represented almost one in five new vehicles registered in Norway last year, a market share unparallelled anywhere in the world thanks largely to consumer incentives that few countries can match.

Almost 26,000 zero emission cars--all of them electric except for nine hydrogen vehicles--were registered last year in the Scandinavian country, out of a total of 150,700 private new cars, according to the Information Council for Road Traffic.

That took the electric car market share to 17.1 percent, up from 12.5 percent in 2014.

"Norway has an incredibly important role. It is the North Star for what is going on in the rest of the world" in the field, said Christina Bu of the Norwegian Association for Electric Cars.

The Scandinavian country, which ironically enjoys abundant wealth from its North Sea oil and gas reserves, offers numerous incentives to encourage car-buyers to opt for clean vehicles.

While traditional cars are heavily taxed, electric car owners benefit from almost total tax exemptions, making them much more competitively priced.

The electric version of the Volkswagen Golf, the most popular zero emission car sold in Norway last year, retails for 254,000 kroner (26,350 euros, $28,300), much cheaper than the equivalent diesel version sold for 327,000 kroner.

Thanks to the tax breaks, around two-thirds of the electric Golfs made by VW are sold in Norway. The country is also the second-biggest market, behind the United States, for the Tesla S, a US luxury sedan now frequently seen on the streets of Oslo. 

Electric car motorists also enjoy other perks, such as exemptions on road tolls, and, under certain conditions, the use of collective transport lanes and free parking.

Oslo will also shortly open what is likely to be the world's largest electric car parking lot, with 86 recharging stations available at no cost.

Other Countries in the Dust

Other countries trail far behind Norway. In France, where the government offers 10,000 euros to car owners who swap their old diesel for a new electric car, the latter represented just 0.9% of new car registrations last year.

In the Netherlands, another country that has been successful at encouraging green vehicles, electric cars represented 2% of new car registrations in the first 11 months of 2015. According to ING, the country's biggest bank, that share is expected to rise to 7% by 2020. 

"It's a little difficult for other countries to copy Norway because they don't have the same high taxation of traditional cars," Bu noted.

"But there are a lot of aspects of Norway's policies that could be copied without posing budgetary problems, such as allowing green motorists to drive in bus lanes. It doesn't cost anything and it could even make traffic flow better," she said.

Faced with the battle against climate change, which 195 countries reaffirmed at the COP21 climate summit in Paris in December, the changeover to green cars seems inevitable.

On the sidelines of the Paris meeting, 13 European and North American countries and states--including Germany, Britain, Norway, the Netherlands, Quebec and California -- agreed that all of their new cars would be zero emitters by 2050.

After Norway reached its goal last year of having 50,000 electric cars rolling on its roads, the country now plans to very gradually reduce some of its incentives, which are controversial because of their high cost.

"We are hoping and counting on the incentive measures remaining in place for a while, until this new technology has taken solid root and is really competitive without the benefits" on offer, Volkswagen Norway spokeswoman Anita Svanes said.

"It will take a while before production volumes reach a level where the electric car is as competitive as other cars," she added.

Copyright Agence France-Presse, 2016

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Agence France-Presse

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