Economy 4 December 2024, 11:20am

Hungary green licence plate registrations drop again, but trend remains favourable

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The number of green licence plates issued in Hungary dropped 2.1% month on month and nearly 11% year on year in November, according to the latest data by the Ministry of the Interior. The number of pure-electric passenger cars newly registered with green licence plates showed a 1.7% month-on-month decline, but an over 36% year-on-year increase. With green licence plate registration rules tightened on 1 September, the share of hybrid electric and plug-in hybrid electric vehicles in all new registrations remains practically zero, but the cumulated figures do not reflect the change and the Energy Ministry has made a highly upbeat forecast for the spread of electric vehicles.

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Monthly data

Green momentum slackens further

In November 2024, a total of 1,946 vehicles were registered with green licence plates in Hungary, 2.1% fewer than in October and 10.6% fewer than in the same month of 2023. This marks the fifth m/m drop this year after April (-13%), July (-10.8%), September (-26.1%), and October (-6.1%).

Green licence plate registrations have dropped in annual terms for the second time since July 2023.

The following graph shows the monthly tally of green plate registrations since January 2020 in the three main categories: Battery Electric Vehicle (BEV), Hybrid Electric Vehicle (HEV) and Plug-in Hybrid Electric Vehicle (PHEV).

The dramatic fall in the HEV and PHEV category was triggered by regulatory changes (which are described in the box below). While we continue to receive monthly data on new passenger car registrations, including electric vehicle uptake for all engine types from the European Automobile Manufacturers' Association (ACEA), but the HEV and PHEV numbers in the future green licence plate reports of the Ministry of the Interior will continue show zero.

Extended-range, externally chargeable hybrid electric vehicles (5N) and externally chargeable hybrid electric vehicles (plug-in hybrid vehicles, 5P) have no longer been able to receive green number plates when first registered in Hungary since 1 September 2024. In addition, previously issued green number plates for these vehicles will have to be replaced by 30 November 2026 at the latest, beyond which date they must have regular licence plates.

Environmentally friendly vehicles (5E, 5N, 5P, 5Z) uniformly benefit from the following discounts: (i) exemption from vehicle tax, (ii) exemption from company car tax, (iii) exemption from transfer tax and (iv) zero registration tax.

With those in the 5N and 5P categories no longer deemed environmentally friendly from 1 September, they should be subjected to the vehicle tax, although the regulation does not define precisely what environmentally friendly means. If they were to further specify the definition in the vehicle tax law, vehicles classified as 5N and 5P will most likely be subjected to the company car tax too. These vehicles are also most likely to be subjected to the transfer tax and the registration tax (estimated to be HUF 76,000).

All electric

March saw the registration of 2,108 battery electric vehicles (BEVs) in Hungary, an all time high. June recorded the second-highest number (2,072), and after two consecutive months of decline, again 2,072 BEV's got green licence plates in Hungary in September, a growth of over 34% in monthly terms, which was followed by a nearly 35% yr/yr growth in October.

A total of 1,917 BEVs were registered in November , down 1.7% month on month, but up 36.3% year on year.

The new registration of passenger cars in the BEV category showed a 2.5% month-on-month decline, which comes after a 7.5% decrease in October and a whopping 36% jump in September.

As for trucks, a total of 142 of them got green licence plates last month, 10.1% more than in October (129) and nearly 60% more than in November 2023 (89).

A total of 1,668 all electric passenger cars were registered with green licence plate on a monthly average in January-November, and with HEVs and PHEVs ditched,

this number should exceed 2,300, a 38% jump, only to maintain the growth rate.

Hybrid electric (HEV) and plug-in hybrid electric vehicles (PHEV)

HEVs are the second most popular type among electric vehicles in Hungary, but with far fewer of them getting registered than of BEVs. August brought an absolute record with 1,123 new registrations, while the ministry reported 13 registrations for September, October, and 16 for November. As noted above, neither the surge, nor the plummet is surprising, given the changes to green licence plate rules that came into effect on 1 September.

Registrations of PHEVs have been erratic, with a slightly descending trend. As in the case of HEV's and for the very same reasons, August brought a jump in registrations (173), which was followed by massive fall (2) in September and 2 registrations in October and November each.

How many vehicles with green licence plates we have?

The answer to that question is: 113,324 to be exact. The end-October figure marks a 1.75% month-on-month growth, down from 1.82% in October (the growth rate has been dropping since July). Compared to a year earlier, the above figure marks a 34.2% increase, down from 35.4% in October. The number of green plates is now 6.5 times greater than in January 2020.

The Ministry of Energy said today that it expects the number of battery electric vehicles (BEVs) to reach 120,000 by 2026, which would mark a 75% growth from the end-November figure.

This target seems realistic only if they mean the end of 2026, considering that an average of 2,000 new electric cars are newly registered every month. This figure has been exceeded already three times this year and market trends suggest that this trend will only continue to gain momentum. Having 120,000 BEVs registered by January 2026 would require monthly registrations of some 4,000 BEVs, which seems out of reach.

The geographical distribution shows that while at the beginning almost the same share of green licence plates were registered in Budapest (48.9%) than in the rest of the country (51.1%), the ratio has become much healthier by now, with 61.4% registered in the countryside and 38.6% in the capital.

As for the specific categories, the number of environmentally friendly motorcycles grew from 66 in January 2020 to 680 by end-October. Of BEVs, including passenger cars, trucks, buses, and tractors, there were 66,416 registered in Hungary, a 44.3% annual growth and almost 9 times as many as in January 2020.

The number of HEVs totalled 31.534, up 26.6% yr/yr, while the number of PHEVs shows an 8.8% growth to 12,639. Although the figures shown in graph below represent a wider range of vehicles (as the note in the chart says), passenger cars comprised virtually 100% of HEVs and PHEVs and 93% of BEVs in November.

How popular are the different kind of EVs in Hungary?

Green licence plate registrations took off in the first half of 2022 compared to the H1 2021, then the growth petered out in January-July last year only to soar again in the first nine months of this year. The same pattern applies to BEVs, while HEVs showed a more modest but steady growth, and the popularity of PHEVs actually subsided.

Unless one of the ministries or the Central Statistical Office (KSH) decide to publish detailed statistics, i.e. a breakdown of EVs, we will be able to learn about the HEV and PHEV registrations only from the monthly ACEA reports, but those DO NOT include imported (second-hand) vehicles, while the Hungarian green licence plate stats do.

The changes in the share of the three types of EVs in total new registrations reflect the above numbers, of course, showing a temporary faltering but undeniable increase in the popularity of BEVs, a modestly eroding uptake of HEVs and a clearly dissipating love for PHEVs.

These graphs will soon become obsolete, unless we want to reminisce, due to the tightened registration rules, which are clearly reflected in the chart below.