Between 2020 and 2024, the average list price of a new car sold in France surged by 24%, or nearly 7,000 euros more. Registrations, on the other hand, fell by 22% during the same period, dropping from 2.21 million new vehicles in 2019 to 1.72 million in 2024.
This disconnect between prices and volumes is not the result of a single cause.
Upmarket Shift by Manufacturers: A Factor Confirmed by the Numbers
The study published by the Institute for Mobility in Transition (IMT) and the consulting firm C-Ways breaks down the origins of this increase. The inflation of raw materials, energy, and labor costs accounts for only less than 6% of the increase in the average selling price, which is about 1,200 euros on a production cost estimated at 16,000 euros.
Most of the increase therefore comes from elsewhere. Manufacturers have deliberately shifted their offerings towards more profitable segments. Enhancements in standard equipment, the proliferation of high-end finishes, and the gradual phasing out of small entry-level models: the strategy aims to increase the margin per vehicle sold rather than the volume.
This choice of “pricing power” has worked for the financial results of automotive groups. However, it has mechanically excluded a portion of buyers, particularly households that renewed their vehicles every five to seven years. An article detailing the prices of cars on Racing Car illustrates the extent of this pricing drift across all segments.
European Standards and Car Tax: What Real Impact on the Final Price
Some manufacturers point to environmental regulations as the main culprit. The IMT/C-Ways study nuances this narrative: European constraints account for about 6% of the price increase. This is not negligible, but it is also not the dominant factor.
The tightening of the car tax in 2026 adds an additional layer. Heavy or high-emission vehicles see their final price increase directly due to this tax. The most affected categories are predictable:
- Thermal SUVs, whose weight frequently exceeds the weight tax thresholds
- Heavy plug-in hybrids, long spared by taxation but now in the crosshairs
- Large family vehicles, penalized by both their emissions and their mass
The tax acts as a price accelerator on models already positioned at the high end of the price spectrum. For buyers of city cars or light compacts, its impact remains limited.
Electrification and Battery Costs: A Transition That Affects Prices
The massive electrification of ranges contributes to driving prices up. The manufacturing cost of an electric vehicle remains higher than that of an equivalent thermal model, mainly due to the battery. Manufacturers pass this difference on to the list price.
The high purchase price of an electric car does not necessarily reflect its total cost of ownership. According to the Roole 2026 survey, driving electric is significantly cheaper on a daily basis than thermal. Maintenance is lower, and energy costs are reduced. Insurance, however, is more expensive for electric vehicles, particularly due to the high cost of repairs related to batteries, a point raised by France Assureurs in a study published at the end of 2025.
This asymmetry between purchase price and usage cost creates a strong psychological barrier. Many potential buyers see the entry ticket without factoring in the savings over the duration of ownership.
The Used Electric Car Market as a Safety Valve
In 2026, transactions of used electric cars are rising sharply in France. Some first-generation models become accessible at prices significantly lower than new ones. The price surge mainly concerns new cars and does not uniformly affect the used market.
This segment could play a counterbalance role for households excluded from the new car market, provided that the range and condition of the batteries in used models meet daily usage needs. Field reports vary on this point depending on the models and years of circulation.
Decline in Volumes and the Scissors Effect on the French Market
The mechanics are classic in the automotive economy: when prices rise, volumes fall. Price-volume elasticity is particularly strong in this sector. With a 22% drop in sales between 2019 and 2024, the French market perfectly illustrates this phenomenon.
Manufacturers compensate for the decline in volumes with higher unit margins. This circle has its limits. The market continues to contract despite efforts to stimulate it.
The factors reinforce each other: the upmarket shift excludes buyers, the decline in volumes pushes manufacturers to maintain high prices to preserve their profitability, and regulations add costs that no one absorbs. The IMT/C-Ways study describes this situation as a “systemic polycrisis,” a term that reflects the interweaving of causes without any being isolated as a unique trigger.
The open question remains that of the breaking point. At what price level does the market become structurally unable to renew itself at a sufficient pace to maintain the French vehicle fleet? The available data do not allow for a definitive determination of this point, but the current rate of fleet renewal is already described as unprecedented by industry analysts.
