Norway has moved ahead in the global electric vehicle market as nearly all new car sales last year were electric. The Nordic country continues to phase out petrol and diesel vehicles rapidly. Tesla led the market while Chinese brands also expanded their share. Strong incentives and tax policies drove the surge in 2025 registrations.
Record Electric Vehicle Sales in Norway
According to data provided by the Norwegian Road Federation, all new cars registered in 2025 were 95.9% electric. It increased to nearly 98% in December alone. The number of new cars registered in the year was 179,549, which is 40% higher than in 2024. It has a good consumer response to the government incentives and policies.
Tesla continued its dominance in market share by selling the largest share of 19.1% in the fifth year of dominance. Volkswagen came in at 13.3% then Volvo with 7.8% of all the total registrations. The Model Y was the best in sales with the sale of 27,621 vehicles in 2025. Such a figure is greater than what any other car company ever sold in Norway during one year.
Chinese Brands Gain Market Share
In 2025, the market share of cars manufactured in China in Norway was 13.7%. This is compared to 10.4% in 2024, which was contributed by the increasing sales of BYD. Last year, BYD increased its car sales in Norway more than twice. The Chinese auto-makers are also keeping the market interested with competitive prices and increasing supply.
Furthermore, Ford Norway redirected vehicles not originally planned for the country to meet high demand. Ford Norway’s Managing Director noted that factories prioritized Norway for quicker deliveries. The strategy allowed brands to meet year-end demand before the tax increase. Automakers adapted production and logistics to support Norway’s EV growth.
Tax Policies Drive Rapid EV Adoption
Norway has implemented EV taxation in 2023 and declared VAT charges in October 2025. By January 1, 2026, there will be a value-added tax of up to $5000 per car. The announcement made buyers and companies to have cars registered before the year 2025 came to an end.
The cheaper parts of the EVs, including some priced below 300,000 Norwegian crowns, are still VAT-exempt in 2026, which promotes the use of small cars. The government policies strike a balance between incentives and increased charges on petrol and diesel cars. The Norwegian EV Association stressed the fact that the EV shift cannot be explained by the taxes alone.
However, the situation is different in the case of internal combustion engines where the cost is on the rise, thus rendering them less appealing. The only vehicles that are left in the ICE segment include specialized vehicles like emergency response or wheelchair-accessible cars.
Expansion of Car Models Expected
Automakers plan to launch new combustion engine and electric models in Norway. Volkswagen, Audi, Skoda, and CUPRA brands will increase output for the country. Factories accelerated production and prioritized shipments to meet Norway’s growing demand. Compact cars are expected to return as a strong segment in the market.
Executives anticipate the tax changes will further encourage consumers to buy smaller EVs. The shift supports a transition from traditional vehicles to more affordable electric options. Norway continues to lead Europe in battery vehicle adoption. The combination of policies and incentives has created a clear market preference for electric cars.
