Sales of electric cars in Germany plunged 39% last month as demand collapsed due to the removal of government tax breaks.

Sales of electric cars in Europe's largest economy fell to 33,651 units in December from 54,654 units a year earlier.

This has led to a 10% drop in electric vehicle (EV) sales across Europe, according to the European Automobile Manufacturers Association (ACEA).

Overall, electric vehicles will account for 13% of the overall market share by 2024, trailing gasoline and hybrid vehicles (33% and 31% respectively).

European sales fell after a surge in deals last year when subsidies for electric car purchases peaked at €9,000 (£7,550) per car.

Last year's registrations were also affected by manufacturers delaying deliveries of electric cars so they could count towards new emissions standards introduced by the European Union.

Separate data last week showed the German economy shrank for a second consecutive year in 2024, with demand for electric vehicles slumping across the country.

The scale of the challenges facing the German economy was underlined by a new survey from think tank ZEW, which found that economic sentiment fell to 10.3 in December from 15.7.

ZEW President Achim Wambach said: “Insufficient private household spending and weak demand in the construction industry continue to hamper the German economy.

"If these trends continue this year, Germany will fall further behind the rest of the euro area."

At the same time, French electric car sales also suffered a heavy blow in December, shrinking by 20%, according to ACEA.

Like Germany, France is preparing to cut subsidies for electric vehicles from 7,000 euros to between 2,000 and 4,000 euros depending on household income.

With a flood of cheaper alternatives expected to emerge in China, the removal of state support for electric vehicles could make European models less competitive.

However, troubles across Europe led to the UK becoming Europe's largest EV market for the first time last year as strict net-zero sales targets forced manufacturers to offer deep discounts.

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