One in four new cars in Germany now has an electric drive

In parallel, gasoline cars continued to lose ground. 51,806 newly registered passenger cars with purely internal combustion engines represented a share of 21.6 percent – a decrease of 23.7 percent compared to the previous year. Diesel is also weakening: 30,547 new registrations in May meant a decrease of 13 percent. This continues the trend of internal combustion engines declining in popularity among buyers, while electric drives are gaining.

An important pillar of growth is plug-in hybrids. In May, 27,921 such vehicles were newly registered, representing a share of 11.7 percent. Year-on-year, this means an increase of 10.9 percent. In total, 95,466 new registrations were for hybrids – that is 39.9 percent of the market. Purely battery-electric and hybrid drives combined thus accounted for significantly more than half of all new registrations.

Government purchase premium drives demand

The government purchase premium plays a central role in this development. The purchase or leasing of a new e-car in Germany can be subsidized with 1,500 to 6,000 euros, depending on the vehicle, income, and family size. A total of three billion euros from the federal Climate and Transformation Fund is earmarked for this, which is intended to enable around 800,000 subsidies in the next three to four years. The fund is financed, among other things, by revenue from CO2 pricing.

The rush for subsidies is apparently high. In the first week after the launch of the new purchase premium, the Federal Office for Economic Affairs and Export Control (Bafa) received nearly 30,000 applications for subsidies for purely electric passenger cars. However, only private purchases are eligible for subsidies – but commercial owners account for two-thirds of the market. According to the assessment of automotive market expert Ferdinand Dudenhöffer, the premium has led manufacturers to reduce their discounts on new vehicles. The price difference between e-cars and new internal combustion engine vehicles simultaneously increased by 147 euros to 1,971 euros in May.

Manufacturers in competition: Leapmotor, BYD, Tesla, VW

Among manufacturers, very different dynamics are evident. The Chinese manufacturer Leapmotor recorded an increase in registrations of 139.1 percent in May compared to the same month last year. BYD registered 6,169 new vehicles in Germany, of which 4,290 were plug-in hybrids. In April 2026, VW led the plug-in hybrid segment with 4,618 vehicles, while BYD had 2,830 new registrations. Tesla registered 5,111 new vehicles in Germany in May, an increase of 322 percent compared to the weak previous year's figure; since the beginning of the year, growth has been 200 percent, after an interim high of 9,252 was reached in March 2026.

SUVs remain the largest segment

In terms of vehicle segments, SUVs remained the strongest segment in May: their share of new registrations was 35.4 percent, with growth of 5.3 percent. Mini-vans recorded the largest percentage increase with 22.1 percent, albeit with a small market share of only 0.6 percent. The mid-size segment grew by 19.8 percent and accounted for 9.1 percent of all new registrations.

The development in May 2026 supports the picture of a market in transition: purely electric cars and hybrids together clearly dominate, while internal combustion engine vehicles are noticeably losing ground. At the same time, government subsidies are providing an additional boost, even though a large part of the market – commercial purchases – has not yet benefited from the premium. The market development in the coming months will show whether the quarter-share level can be maintained and further expanded.

There had also been some movement recently in discounts on new e-cars: in January 2026, the average price reduction on the 20 best-selling electric cars was still 19.5 percent. With the introduction of the premium and rising demand, manufacturers have apparently adjusted their margins – to the advantage of the corporations, but possibly at the expense of individual buyers.