A view of the BMW i3, a midsize electric sedan produced at the BMW Group plant in Munich, Germany. Following the midsize electric SUV iX3, the i3 is the second vehicle built on the group’s first dedicated electric vehicle platform, Neue Klasse, and will enter full-scale production this August &#40;Provided by BMW Korea&#41; 2026.4.7

European automakers are accelerating their transition to electrification by developing and mass-producing new electric vehicles (EVs) while unveiling medium- to long-term electrification strategies. This stands in stark contrast to American and Japanese manufacturers, who are canceling EV development projects. Industry analysts suggest that the pace of electrification among automakers is largely influenced by the growth of their domestic EV markets.

BMW to Invest 1.8 Trillion KRW in Neue Klasse Plant… Renault to Develop and Produce Mid- to Large-Size EVs in Korea

According to automotive industry sources on Wednesday, Germany's BMW Group is set to begin mass production of its mid-sized electric sedan, the i3, at its Munich plant this August. Following the March launch of the mid-sized electric SUV iX3, the i3 will be the second vehicle produced on the group's first dedicated EV platform, Neue Klasse. The i3 boasts an impressive range of 900 kilometers (about 559 miles) on a single charge, unofficially claiming the title for the longest driving distance in Europe.

In preparation for i3 production, BMW Group invested 650 million EUR (about 758 million USD) over the past four years to modernize its century-old Munich plant. The iX3 is manufactured at a new facility in Debrecen, Hungary, established in 2018 with a 1 billion EUR (about 1.16 billion USD) investment. The group aims to expand its Neue Klasse electrification lineup based on the iX3 and i3 models, targeting EVs to comprise half of its global sales by 2030.

François Provost, Chairman of the Renault Group, poses for a commemorative photo after explaining the group’s mid-to-long-term strategy, the futuREady Plan, announced last month, to the Korean press during a media roundtable held on April 3 at the JW Marriott Hotel in Seocho-gu, Seoul &#40;Provided by Renault Korea&#41; 2026.4.3

France's Renault Group is also ramping up its electrification efforts. Through its recently announced long-term strategy, Future Ready Plan, Renault aims to launch 36 new models across its brands, including Renault, Dacia, and Alpine, by 2030. Of the 22 models allocated so far, 16 are confirmed as EVs. Renault targets 50% of its new cars sold in Europe by 2030 to be electric, with the remaining 50% as hybrid vehicles, pushing for 100% electrification. The company also plans to increase the share of EVs and hybrids to 50% in regions outside Europe.

Renault intends to introduce EVs not only in the A (mini), B (small), and C (compact) segments where it traditionally holds market dominance but also in the D (mid-size) and E (large) segments. To achieve this, the company will leverage its Renault Korea Central Research Institute and Busan plant, which serve as key research and production hubs for D and E segment vehicles. Additionally, Renault will strengthen its battery collaboration with LG Energy Solution. François Provost, chairman of Renault Group, visited Korea as his first overseas trip following the Future Ready Plan announcement on April 5.

Germany's Volkswagen Group is set to realize the fruits of its urban EV strategy, announced at the IAA Mobility Show last September, this year. The group's flagship brand, Volkswagen, plans to launch two models in the European market in the second half of 2023: a small electric sport utility vehicle (SUV), the ID. Crozz, and a small electric hatchback, the ID. Polo.

Both models are expected to have starting prices in the high 20,000 EUR (about 23,300 USD) range. By incorporating affordable lithium iron phosphate (LFP) batteries in the base trim alongside nickel-cobalt-manganese (NCM) batteries, they have significantly reduced costs.

A concept car of the ID. Cross, a compact electric SUV that Volkswagen will launch in the European market in the second half of this year &#40;Capture from Volkswagen website&#41; 2026.3.26

Ford, Honda Scale Back as EV Market Contracts… Dropping Electrification Risks a Wider Sales Gap

In contrast, American and Japanese automakers are not just slowing their pace of electrification; some are abandoning EV projects entirely. Ford announced in December the cancellation of its next-generation electric pickup truck (T3) and electric commercial van plans, citing profitability concerns. Production of the electric F-150 Lightning ceased last year, just three years after its launch. Ford also dissolved its joint venture with SK On for a U.S. battery factory in Q1 2023.

Japan's Honda recently announced the suspension of its Afeela EV project, developed in collaboration with Sony, citing potential losses of up to 2.5 trillion JPY (about 15.8 billion USD). This decision comes four years after the project's 2022 launch. Initial plans for California deliveries this year and Japan deliveries in early 2024 have been scrapped. Honda has also halted development of three other EVs slated for North American production: the Honda 0 SUV, Honda 0 Saloon, and Acura RSX.

These companies' electrification strategies appear to be influenced by their domestic EV market conditions. While the European EV market is projected to decline in 2024, it rebounded strongly in 2023 with a 29.7% increase, selling 2,585,187 units.

In contrast, U.S. EV sales dropped 2% last year to 1,255,714 units, marking a decade-long decline due to subsidy cuts. Japan's EV sales reached just 60,677 units in 2023, a modest 1.6% increase. The relatively low market share of European brands in the U.S., the world's second-largest auto market after China, also explains why European manufacturers have maintained their electrification strategies.

Lee Hang-koo, an advisor at the Korea Automotive Research Institute, notes that while companies retreating from electrification cite hybrids as an alternative, hybrids ultimately serve as a transitional technology towards full EVs. He points out that even Toyota, the world's largest automaker known for its hybrid focus, aims to sell 3.5 million EVs globally annually by 2030.

Lee adds that with Europe set to limit internal combustion engine vehicle sales to less than 10% of all new car sales by 2035, the global sales gap between companies accelerating electrification and those lagging behind will widen further. He also notes that EV markets in India and Southeast Asia are already rapidly shifting towards Chinese electric vehicles.

Visitors examine the next-generation electric vehicle Aphila at the Sony Honda Mobility booth at the Las Vegas Convention Center &#40;LVCC&#41; in Nevada, USA, during CES 2026, the world&#39;s largest IT and consumer electronics trade show, held last January 2026.1.7 / News1

European automakers are accelerating their transition to electrification by developing and …

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