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Italy's automotive landscape is undergoing a significant transformation, with electric vehicles (EVs) gaining momentum and fossil fuel-powered cars experiencing a decline. According to recent data, between January and March 2025, diesel deliveries sank by 34.1%, with a total of 44,685 units, marking a significant drop compared to the same period in the previous year.
Simultaneously, the EV market is showing impressive growth. Combining battery electric vehicles (BEVs) and plug-in hybrid electric vehicles (PHEVs), the market achieved a 55% improvement in registrations in March 2025. Over the first quarter, PHEVs have seen registrations improve by 31%, while hybrids, when added into the mix, have boosted the electrified market by 28.4%.
Italy's electrified passenger-car market, including hybrids, BEVs, and PHEVs, drove the market in March. In fact, hybrids were the dominant powertrain in Italy's new-car market, with a 45.2% market share. This surge in electrified vehicles has resulted in the electrified market rising 20.2% in the first three months of 2025, and accounting for 54.1% of total registrations.
BEV registrations increased by 74.8% in March, with 9,369 deliveries, indicating a strong preference for zero-emission vehicles. Meanwhile, petrol suffered its eighth consecutive monthly decline in March 2025, with a 9.4% year-on-year decrease in registrations.
These trends reflect Italy's commitment to reducing carbon emissions and aligning with European Union (EU) climate initiatives. The European Action Plan has amended the period for CO emission regulations to be met, allowing carmakers to average their figures over a three-year period.
Italy's growth in the EV market is supported by tax advantages for corporate fleets and stricter emissions regulations, fostering adoption of electrified vehicles. The government's National Recovery and Resilience Plan is funding expansions in electric public transport, including procurement of over 600 battery electric buses by Consip to decarbonize urban, intercity, and regional transit.
The entrance of major players like Geely, backed by partnerships with local distributors such as Jameel Motors, underscores Italy’s strategic position as a growing EV market. Geely’s Milan Design Center and aggressive market entry aim to capitalize on Italy’s upward trend and to compete across Europe.
While Italy's EV market is growing rapidly, it still lags behind some leading European countries like Norway and Germany. As of mid-2025, Italy’s EV market share stands around 10% of total new vehicle sales (BEV + PHEV), which is lower than market leaders like Norway, where EV penetration exceeds 80%. However, optimistic projections suggest that the EV share could double by 2026 from 10%, driven by policy support and increasing corporate fleet electrification.
In comparison, across Europe in the first half of 2025, BEV registrations surged by 34% year-on-year and outpaced PHEV growth, signifying a preference shift toward fully electric vehicles. While PHEVs still hold a considerable share in some markets, their growth rate is lower compared to BEVs. Italy’s stronger reliance on PHEVs, due to existing tax benefits for hybrids, contrasts somewhat with markets advancing faster toward pure BEVs.
Roberto Vavassori, president of ANFIA, believes more can be done to reduce the bloc's aging car parc to reduce overall CO pollution. As the EV market continues to evolve, it is expected that Italy will continue to make strides in electrifying its transportation sector and reducing its carbon footprint.
Technology plays a significant role in Italy's transformation of its automotive landscape, as the EV market exhibits impressive growth, driven by the surge in electrified vehicles such as BEVs and PHEVs. This shift towards electrification is supported by factors including tax advantages, stricter emissions regulations, and government funding for electric public transport.
