The shift to electric vehicles (EVs) is often portrayed as a smooth road to a greener future – but a new report reveals that Europe’s journey may be far more complicated than anticipated.
According to a comprehensive study from the Centre for European Policy Studies (CEPS), supported by the European Automobile Manufacturers’ Association (ACEA), the EV transition faces serious roadblocks that could threaten the global competitiveness of the EU’s automotive industry.
From soaring production costs and supply chain overhauls to lagging infrastructure and workforce disruption, the report highlights that electrifying Europe’s car and van fleets demands far more than just replacing engines – it requires a complete industrial transformation.
A pivotal moment in Europe’s automotive evolution
Europe’s automotive industry stands at a defining crossroads. As internal combustion engine (ICE) vehicles phase out in favour of battery electric vehicles (BEVs), the region must grapple with a monumental overhaul of its automotive ecosystem.
The CEPS report underscores that this transition isn’t just about switching powertrains, it demands a wholesale transformation of supply chains, manufacturing processes, labour skills, and business models.
Despite mounting pressure to decarbonise transport and meet climate targets, several entrenched challenges continue to stall momentum.
Insufficient charging infrastructure, high upfront costs, and low consumer confidence, especially in price-sensitive segments, have restricted the uptake of EVs.
As a result, the average age of vehicles on Europe’s roads is rising, delaying fleet renewal and hindering emissions reduction efforts.
Competitiveness at stake
One of the report’s starkest warnings concerns the threat to the EU’s global competitiveness in vehicle manufacturing.
Whereas ICE vehicle production traditionally retains 85–90% of value within Europe, the shift to BEVs could reduce that share to just 70–75%.
This decline is largely driven by Europe’s current dependency on external battery cell suppliers, particularly from China, which currently provides around 70% of battery cells used in the EU.
To regain control over this crucial segment, the report estimates the EU will need to invest €42bn annually in battery production infrastructure up to 2030. Without this investment, the bloc risks falling behind global competitors and losing its industrial edge.
The price gap and consumer resistance
Cost remains a persistent obstacle in the EV transition. According to the CEPS analysis, the average price required to maintain current BEV pricing structures hovers around €45,000.
However, consumer willingness to pay for an EV remains significantly lower, averaging just €20,000. Bridging this gap is essential for achieving mass-market adoption and ensuring that EVs become a realistic option for everyday drivers, not just a luxury item.
Infrastructure lag and bureaucratic barriers
Beyond production challenges, the EV transition is hampered by Europe’s lagging charging infrastructure.
To meet expected demand by 2030, investments totalling €172bn are needed. However, progress is being stymied by bureaucratic red tape, complex permitting procedures and slow grid connection approvals are among the primary culprits delaying deployment.
Skills and jobs in transition
The shift from ICE to EV production also has profound implications for employment. While new roles will emerge, particularly in battery manufacturing and software integration, they may not fully compensate for the jobs lost in traditional engine production.
The report stresses the urgency of investing in upskilling and retraining programmes, as many skills can be transferred but require adaptation.
The road ahead
The CEPS report makes one thing clear: the EV transition is not a linear or painless process. It demands coordinated policy support, strategic investment, and a deep restructuring of Europe’s industrial base.
If managed effectively, it could secure Europe’s position as a global leader in green mobility. But without bold action, the continent risks losing both economic value and its competitive advantage.
