Drivers of petrol and diesel vehicles are bracing for potentially substantial increases in costs starting next year, driven by a combination of new European regulations and shifting market dynamics.
A recent report indicates that the implementation of Euro 7 emissions standards by the European Automobile Manufacturers Association, slated to begin in November 2026, could add an average of £1,650 to the price of each vehicle. These stricter rules will impose tighter limits on nitrogen oxides and control particle emissions across all car types—including electric vehicles.
Adding further pressure is the Zero Emission Vehicle (ZEV) mandate, which requires manufacturers to significantly increase their share of electric vehicle sales. Brands must achieve at least 28% EV sales this year, escalating to a full transition by 2030. To offset these costs and make electric vehicles more appealing, automakers are compelled to raise prices on traditional petrol and diesel models.
The cost of new cars has already seen dramatic growth over the past decade. Analysis from Auto Express reveals that the average list price for a new petrol car has climbed sharply, increasing from £27,036 in 2015 to £45,218 today—a significant jump.
Considering inflation alone, experts suggest current petrol cars should cost around £36,225. The discrepancy highlights the impact of regulatory burdens and other factors beyond simple price adjustments.
Here’s a breakdown of price changes across various vehicle types:
- Petrol: Up 67%
- Hybrid: Up 45%
- Diesel: Up 107% (average price £58,173)
- Electric Vehicles: Up 85% (average price £61,701 – currently the most expensive option)
The impact varies across different models. For example:
- Dacia saw a 33% increase, adding £4,697 to its Duster model.
- Mercedes E-Class prices rose by £11,951 (26%).
- Volkswagen increased Golf prices by £5,994 (25%).
- Ford limited the Puma’s increase to 12%, adding £3,074.
Experts point to several factors contributing to these increases. “Covid-19 disrupted the traditional supply and demand balance in Europe’s car factories,” explained Phil MacNamara, Editor at Large at Auto Express.
Furthermore, growing consumer preference for larger vehicles is a significant driver of inflation. European cars have increased in weight by 21% since 2000, requiring a corresponding 56% increase in engine power and associated components.
As Dacia’s vice president of product performance noted: “More weight and more power mean more consumption and emissions. But at the same time, we have to meet the European green deal constraints, which are good for the planet.”
The ZEV mandate and Euro 7 regulations, while aiming to promote sustainability, are contributing to a challenging economic landscape for drivers.
As MacNamara concluded: “Politicians want to fast-track EV sales, but it’s been another inflationary measure. Everyone wants safer and cleaner cars. The challenge is who pays the price of progress.”
