Market evolution: Petrol cars (CN 87032319) — 2015–2025

Introduction

This report examines the evolution of EU trade in new petrol-engine passenger cars with a cylinder capacity between 1,500 cm³ and 3,000 cm³ (CN code 87032319) over the period 2015–2025. The EU is the world's leading exporter of this product category, recording a trade surplus of approximately €38.6 billion in the most recent year — down from €50.2 billion in 2015. Over the full decade, exports declined by 26.5% in value and 48.9% in unit count, while imports fell even more steeply (–47% by value, –60.2% by units). Yet unit prices rose significantly on both sides, pointing to a structural shift towards higher-value vehicles and changing trade geography. The analysis that follows dissects these dynamics into three main themes: the sheer contraction in volumes, the reshaping of trade partners, and the EU's evolving position of structural autonomy in this segment.

1. A Decade of Volume Contraction with Rising Unit Values

The most striking feature of the 2015–2025 period is the simultaneous decline in traded volumes and increase in unit prices across both exports and imports.

Export volumes collapsed while unit values surged

EU exports of CN 87032319 fell from 2,356,408 units in 2015 to just 1,204,313 units in the final year of data — a decline of 48.9%. In mass terms, the drop was slightly less pronounced at –41.6% (from 3.81 million tonnes to 2.23 million tonnes), suggesting a shift toward lighter or differently segmented vehicles over time.

The divergence between the –26.5% decline in value and the –48.9% decline in units means that EU export prices per vehicle rose by 43.8%. This reflects a combination of inflation, the rising share of premium German models, and the broader industry trend of manufacturers pushing higher-margin vehicles in the 1.5–3.0 litre petrol segment.

Domestic production fell even faster than exports

EU production of this vehicle category dropped by 60.5% in units (from 6.98 million to 2.75 million) and by 26.7% in value (from €124.2 bn to €91.0 bn). This decline is steeper than the decline in exports, indicating that domestic EU demand for these petrol vehicles shrank even more dramatically — likely due to the accelerating transition to electrified powertrains and tighter CO₂ regulations across the bloc.

Imports mirrored the export trend with even steeper declines

Imports declined faster than exports in both volume (–60.2% vs –48.9%) and value (–47.0% vs –26.5%), consistent with the EU's growing self-sufficiency in vehicle production and the shift of consumer demand away from mid-range petrol cars.

2. Geographical Realignment: Brexit, the Rise of South Korea, and Shifting Import Sources

Beyond the aggregate volume decline, the trade geography underwent substantial restructuring, with some partner relationships collapsing entirely while others strengthened dramatically.

The UK exit from the EU single market restructured both import and export flows

The most dramatic single change in the dataset is the collapse of UK–EU trade following Brexit. UK imports into the EU fell by 90.6% (from €3.45 bn to €326 million), while EU exports to the UK declined by a more modest 19.3% (from €5.10 bn to €4.12 bn). The UK went from being the EU's second-largest import source to a marginal supplier. This is consistent with the UK being reclassified as a non-EU trading partner and the application of new tariff and regulatory barriers.

South Korea emerged as a major EU export destination

Perhaps the most striking growth story is EU exports to South Korea, which surged by 314.4% — from €879 million to €3.64 billion. This effectively tripled, making South Korea the EU's fourth-largest non-EU export market by end of period. The EU–Korea Free Trade Agreement, fully in force since 2011, likely facilitated this growth, combined with strong Korean demand for European premium brands.

The United States remained the dominant export market but with declining share

The United States absorbed €14.5 billion of EU petrol-car exports in the final year — still by far the largest single destination — but this represented a 32.5% decline from the 2015 peak of €21.5 billion. A detected price shock in 2018 (with a –16% price shift and 43.8 abnormality score) on US imports of this product coincides with the period of heightened trade tensions and tariff threats between the EU and US.

China imports from the EU nearly halved

EU exports to China declined by 44.2% (from €10.7 bn to €6.0 bn). This reflects the rapid growth of China's domestic EV and hybrid industries, as well as changing consumer preferences in the Chinese market away from traditional petrol vehicles. With a coefficient of variation of 0.25, China was actually one of the more stable export partners for the EU.

Import sources diversified markedly

The Herfindahl-Hirschman Index (HHI) for imports by value dropped from 2,998 to 1,768 (–41.0%), indicating a significant reduction in import concentration. In the final year:

The near-total disappearance of Turkish imports (–99.0%) and the dramatic fall in French import receipts (–94.9%) stand out as the most extreme contractions. Meanwhile, US imports into the EU grew by 83.6%, possibly reflecting production at US plants by European OEMs re-exporting to the bloc.

3. Structural Autonomy: The EU's Deepening Export Orientation Despite Shrinking Production

While absolute volumes fell across the board, the EU's relative position as a net exporter of petrol cars actually strengthened in structural terms, even as its own production base contracted sharply.

The EU remained a massive net exporter

Throughout the entire period, the EU trade balance in CN 87032319 was strongly positive — ranging from a peak of €60.7 billion to a low of €38.2 billion. Even in the most recent year, the EU exported roughly ten times more by value than it imported. The net import reliance ratio deepened from –52.5% to –189.5%, meaning the EU's export surplus relative to domestic absorption more than tripled.

Export propensity surged as production collapsed

A key structural indicator is export propensity — the share of domestic production that is exported. This rose from 43.4% to 73.8%. In other words, nearly three-quarters of all petrol cars produced in the EU in this engine class are now sold to non-EU markets. This suggests a dual dynamic: domestic demand is being cannibalised by electrified alternatives, while the EU's premium brands (primarily German) continue to find strong demand abroad.

Similarly, trade intensity rose from 48.0% to 75.8%, indicating that international trade plays an increasingly central role in this product's value chain.

Specialisation is concentrated in Central and Western Europe

In 2025, the most specialised EU exporters in CN 87032319 (measured by RSCA) were:

Slovakia's strong specialisation (RSCA 0.74) reflects the major Volkswagen and Kia production plants located there. Belgium's position reflects its role as a major hub for vehicle assembly and re-export.

Germany dominates but Italy and Spain saw dramatic export declines

Germany accounted for €29.7 billion of EU exports in the final year — 69% of the total — down 30.4% from its 2015 level of €42.6 billion. In sharp contrast, Italy's exports collapsed by 80.8% (from €3.3 bn to €636 m), and Spain's by 76.6% (from €2.1 bn to €491 m). These steep declines likely reflect the accelerating shift of production capacity in Southern Europe toward electric and hybrid vehicles.

Conclusion

The EU trade in petrol cars of 1,500–3,000 cm³ (CN 87032319) over 2015–2025 tells the story of an industry in structural transition. While absolute volumes have fallen sharply — driven by tightening emissions regulation, the rise of electrified powertrains, and shifting consumer preferences — the EU has paradoxically deepened its role as a net exporter of these vehicles. Export propensity rose to nearly 74%, and the trade surplus remained a robust €38.6 billion in the most recent period.

The geographical reshaping of trade flows has been equally significant. The UK's departure from the single market caused a near-total collapse of bilateral automotive trade flows; South Korea emerged as a major growth market; and China's appetite for European petrol cars waned as its domestic EV industry matured. Import sources diversified considerably, reducing concentration risk.

The central challenge ahead is whether the EU's export-oriented petrol-car model — heavily reliant on German premium brands and select Central European assembly hubs — can sustain itself as the global automotive market accelerates its shift toward electrification. The 43.8% rise in export unit values over the decade suggests that European manufacturers have so far managed to trade less but earn more per unit. Whether this pricing power endures will depend on how quickly non-EU markets follow Europe's own decarbonisation path.