Diesel engines, once the undisputed dominance of European roads, continue to rapidly decline. The transformation of the automotive market has led to one of the weakest periods in diesel’s history, and diesel has fallen behind plug-in hybrid (PHEV) sales, dropping out of the top three market shares for the first time.
Diesel engine demand has declined
Diesel engines held significant importance in Europe in the early 2010s, accounting for more than half of new car sales. However, this trend was reversed by a slump triggered by the Volkswagen Group’s emissions scandal, and diesel sales have never recovered.

In 2017, gasoline vehicles surpassed diesels for the first time since 2009. By 2021, full hybrids outsold diesels. A year later, pure electric models surpassed diesels in demand in the European market for the first time.
Looking at data for the first ten months of the year, the market share of plug-in hybrids (PHEVs) in the region encompassing the European Union, EFTA countries, and the United Kingdom reached 9.4 percent.
Diesel engines held a market share of only 8 percent during the same period. Consequently, diesel vehicles lost their position as the top three markets, with plug-in hybrids expected to be adopted by 2025. This gap is expected to widen further in the remaining two months of the year.
Multiple factors underlie this decline in diesel prices. Tightening emissions regulations have driven car manufacturers to focus on hybrids, plug-in hybrids, and fully electric models. The cost of this transition has led to the withdrawal of small-scale diesel options, particularly those like the Volkswagen Polo and Renault Clio, from the market.
Furthermore, electrification incentives and lower taxation of green vehicles are among the strong factors pushing consumers toward hybrids and electrics. The increasing efficiency of gasoline engines over the years, the EU’s fleet emissions reduction targets, and the new internal combustion vehicle sales ban coming into effect in 2035 have further diminished the appeal of diesel. Hybrids now account for more than a third of new vehicle sales in Europe. Having achieved a 34.7 percent market share in the first ten months of the year, hybrids maintain their market leadership, ahead of gasoline vehicles (26.9 percent) and electrics (18.3 percent).

