Why car sales in Norway have completely collapsed

Fond of EVs

You will have read it before: Norwegians they love electric cars. 8 out of 10 Norwegian car buyers chose an EV in 2022. A total of 174,000 new cars went on the road in Norway last year, so 80% of them had no internal combustion engine. The entire top 10 best-selling cars in 2022 will consist entirely of electric ones:

Collapsed

In January, the Norwegians suddenly had no appetite for new cars. While 39,497 new cars were sold in December, only 1,860 new units were sold in January. A drop of as much as 95 percent. According to Norway’s RDW, the OFV, there are several reasons for the poor sales figures. The war in Ukraine and the lack of new cars is a factor, but these issues were also prevalent in December.

Taxes, taxes, taxes

The real reason is the adjusted car taxes in effect since January 2023. Norwegians have had to pay VAT on cars with a price tag higher than NOK 500,000 (€45,000) since this year. Also, higher weight cars – electric cars, that is – are taxed more heavily than before. Because of these new tax rules, electric cars – which Norwegians love so much – have suddenly become a lot more expensive in the new year. It often involves thousands of additional euros.

Record numbers

Higher prices mean Norwegians are less inclined to walk into a showroom. Moreover, most have already hit their stride in December. Naturally, Norwegians saw the price increase coming, so they bought EVs en masse in December. You can see the same pattern in our country, where the addition rate for all-electric cars goes up every year, leading Dutch people to quickly buy an EV in December. The OFV says it is too early to say whether the sales decline will continue further into the year. The best-selling model in January was the Volkswagen ID. Buzz – obviously an EV – with only 210 units sold.

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