Norway’s New Car Sales Were 96% Electric in 2025

Almost all new cars registered in Norway last year were fully electric, official data showed on Friday, headed by booming Tesla sales as the Nordic country cements its global lead in phasing out petrol and diesel-powered vehicles.

Driven by tax incentives, 95.9 per cent of all new cars registered in 2025 were EVs, with that number at almost 98 per cent in December. The annual figure was up from 88.9 per cent in 2024, Norwegian Road Federation (OFV) data showed.

A record 179,549 new cars were registered in Norway during the year, a 40 per cent increase from 2024, the OFV said.

Oil-producing Norway's rapid switch to battery-powered vehicles contrasts sharply with the rest of Europe, where weak demand for EVs prompted the EU last month to reverse its planned 2035 ban on internal combustion engine cars.

EV TAXES SET TO RISE

Tesla was Norway's top-selling car brand for a fifth consecutive year, with a 19.1 per cent market share, followed by Volkswagen at 13.3 per cent of registrations and Volvo Cars at 7.8 per cent.

Led by the mass-market crossover Model Y, Tesla sold 27,621 cars in Norway in 2025, more than any other automaker has sold in the country in a single year, overcoming a consumer backlash plaguing the brand in much of Europe over CEO Elon Musk's support for far-right parties and his backing of US President Donald Trump.

Norway, which began taxing EVs in 2023, announced in October that it would add up to $5,000 in value-added tax per vehicle from January 1, sparking a rush among buyers and car firms to beat the 2025 year-end deadline.

"What we did very quickly was to redirect a number of cars that were not originally intended for Norway, to get them here faster," Ford Norway Managing Director Per Gunnar Berg told Reuters.

CARROT AND STICK PROPELS NORWAY'S EV SHIFT

While some EV incentives have been pulled back, the government has also consistently added charges to petrol and diesel cars to make them more expensive, noted Christina Bu, head of the Norwegian EV association.

"That is often misunderstood outside of Norway - they all think it's about tax exemptions and incentives, but it's very much also about the whip," Bu said. "ICE cars are taxed out of business in a way."

The few fossil-fuel cars registered in 2025 were mostly specialised vehicles such as wheelchair-accessible autos or those used by police and other first responders, alongside a few hybrid models and sports cars.

EVs costing less than 300,000 Norwegian crowns, equivalent to about $30,000, remain exempt from VAT in 2026, in a potential boost for small cars, executives said.

"I think the tax changes will accelerate the return of compact cars... which used to dominate both Norway and Europe," Ford's Berg said.

Ulf Tore Hekneby, head of Harald A Moller which imports Volkswagen, Audi, Skoda and CUPRA vehicles, said he expected more combustion engine models to launch as electric.

"There will be a great deal of new launches from our brands for compact cars so we'll get a new lineup that we haven't had in many years," Hekneby said.

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