2023: electric car will become more expensive, demand will increase

In October, the RAI Association and Bovag predicted that a total of 340,000 new passenger cars will be registered in 2023. That is slightly more than the 300,000 to 320,000 registrations expected for this year. ING has also taken up the crystal ball. ING expects that some 335,000 new passenger cars will be registered in 2023 and thinks that we will end up with 315,000 by the end of 2022. To put that in perspective: in 2019 – the last year before the corona pandemic – 446,000 new cars were registered in the Netherlands.

ING’s forecast is slightly more cautious than that of RAI and Bovag. This year, supply chain constraints led to poor availability of new cars. Wiring harnesses and microchips, among other things, are difficult to obtain. Although delivery times are still long, ING expects the impact of the chip shortage to at least decrease next year. Because the improvement in the production chain and therefore also the planning has already started this year, ING expects that there will be a relatively large number of new registrations, particularly in the first half of 2023.

Of all 335,000 registrations, about a quarter will be fully electric. According to ING, the increase in the popularity of EVs is partly due to the growing supply of affordable electric cars. However, the business market is mainly responsible for the growing demand for electric cars. About three-quarters of all EV registrations are accounted for by a business driver. ING considers it plausible that electric cars will rise in price next year, partly due to higher raw material prices. Due to higher energy prices, the benefit of electric driving is expected to decrease next year.

It is not yet a party, car production is expected to remain relatively limited in 2023 as well. Also in 2023, the demand for chips – partly due to the increase in production of the number of electric cars – will exceed the availability. The EV production chain is further disrupted by lagging supplies of necessary metals and by dependence on Chinese production.

ING also expresses the expectation that Dutch motorists will drive more kilometers in 2023, even more than before the corona crisis. The painful consequence of this: more traffic jams. The traffic jam pressure in November was already above that of November 2019. According to ING, the car is still more popular than before the corona pandemic. The fact that the Dutch are driving more also has consequences for the car industry, as ING expects a greater demand for maintenance.

Fleet outdated

The Dutch fleet is aging. On average, a Dutch passenger car is slightly older than 11 years. According to ING, it will take 27 years before ‘the entire fleet’ has been renewed. This means that the Netherlands lags behind countries such as Belgium and Germany. 89 percent of the Dutch car fleet is owned by private individuals, while they account for only 40 percent of new registrations. Private individuals are more likely to opt for a second-hand car and, according to ING, are pushing the choice for an electric car forward. The price increase of used cars has passed its peak, according to ING’s forecast.