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Finland set to have 1.5m EVs by 2040, but lags behind Nordic neighbours

The biggest obstacle to buying an electric car in Finland is still the high price, says an automotive industry group, with the average price last year being around 50,000 euros.

Rear part of a silver car plugged into an EV charging point outside Tampere Hall.
Last year, less than a fifth of newly registered passenger cars in Finland were fully electric. Image: Jani Aarnio / Yle
Yle News

According to a forecast by Finland's Automotive Information Centre, fully electric cars will account for 42 percent of first-registered passenger cars by 2025 and almost 70 percent five years later.

By 2040, there will be more than 1.5 million fully electric cars on Finland's roads, the industry group predicted.

Aki Tilli, a chief adviser at the Finnish Transport and Communications Agency (Traficom), said that the renewal of Finland's vehicle fleet must be quickly accelerated. This partly depends on charging infrastructure.

"It's absolutely crucial that housing cooperatives have as many charging options as possible for electric cars," he said.

The Association of the Finnish Automobile Importers points out that purchasing decisions made now have impacts far into the future.

"A new car bought today will end up being recycled in 2045. The average cycle life is over 22 years," Tero Kallio, the industry lobby's managing director, told the Finnish news agency STT.

Price is the biggest obstacle

Tilli said that attitudes towards electric cars have become more positive.

According to a survey by the Automotive Information Centre, 82 percent of motorists in Finland would consider buying a petrol-powered or petrol hybrid car next, while 55 percent might buy a plug-in hybrid, and 42 percent a fully electric car.

"Acceptance of electric cars is increasing as people have more personal experiences with them," said Kallio.

According to Tilli, the high purchase price of electric cars is the biggest obstacle to their widespread use. Last year, the average price of an electric car was around 50,000 euros. However, operating costs are much lower, and their relative share among newly registered cars has risen steadily.

As of the beginning of June, there were 175,000 rechargeable cars in Finland, of which more than 60,000 were fully electric.

That's just a drop in the bucket of the nation's total 2.7 million passenger cars, though. According to the Automotive Information Centre, approximately 94 percent of passenger cars still have combustion engines.

Norway, Sweden far ahead

Finland's uptake of EVs remains much slower than in its Nordic neighbours.

In Sweden, plug-in vehicles represented almost 62 percent of the new-car market in May, up from 47.5 percent a year earlier. Full electrics accounted for a 41-percent share, with the share of plug-in hybrids down slightly year-on-year, reports CleanTechnica.

Meanwhile in neighbouring Norway, plug-in vehicles (including hybrids) accounted for nearly 89 percent of all new passenger cars registered last month, up from about 85 percent a year earlier. All-electric cars represented almost 81 percent of the total volume, compared to around 73 percent a year ago. Norway heavily subsides EVs – with wealth largely earned from fossil fuel sales.

In Finland, the share of fully electric cars in first registrations was around 35 percent in May. However, the share of new EVs in new-car orders has declined to less than 20 percent since the beginning of the year due to high prices and long waiting lists.

EVs crucial if new cabinet loosens biofuel requirement

The share of biofuel that must be mixed into regular petrol and diesel has been a hotly contested issue in the ongoing talks on forming a new Finnish government. The Finns Party argues that it unfairly raises costs for drivers with traditional vehicles, while the smaller Swedish People's Party has insisted the share must be gradually increased to meet Finland's climate commitments and EU rules.

According to Kallio, accelerating the electrification of the nation's car fleet will become even more important if the new government cancels the previously agreed biofuel requirement. About half of the emission reductions planned for transport this decade are based on raising of that share.

"The advantage of electrification is that its emission effect is permanent, and the reduction is repeated every year compared to the situation where the same driving kilometres would be driven using fossil fuels. By speeding up the rotation of the car fleet and with well-targeted purchase incentives, we could have almost 900,000 rechargeable cars on the road by 2030, whereas with the current trends the number would remain at around 600,000," predicted Kallio.

"Effective measures to speed up the renewal of the car fleet include, among other things, purchase subsidies, a recycling fee and the continuation of tax incentives for electric company cars," suggested Tero Lausala, CEO of Finland's central motor trade organisation in a statement in early June.

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