EU Policy Shift Boosts REEV Sales by 2030

The European Union’s planned adjustment to its 2035 internal combustion engine (ICE) ban is set to reshape the electric vehicle roadmap. According to new research from TrendForce, the regulatory shift could significantly accelerate adoption of range-extended electric vehicles (REEV) over the next decade.

For eeNews Europe readers tracking automotive electrification, power electronics, and the semiconductor supply chain, the development is noteworthy. The move not only affects vehicle architectures and OEM strategies, but also has direct implications for batteries, power modules, and materials used across Europe’s automotive ecosystem.

Regulatory flexibility boosts REEV outlook

According to the release, TrendForce expects global annual REEV sales to reach 3 million units by 2030, roughly double the level projected for 2025. The firm attributes this growth to a combination of policy flexibility, improving technology maturity, and increasing consumer acceptance.

In late 2025, the EU announced plans to revise its original requirement for “100% zero emissions” from new cars by 2035, replacing it with an “average overall emission reduction of 90%.” Under the proposal, remaining emissions could be offset through measures such as low-carbon steel usage and synthetic fuels. Final approval by EU member states and the European Parliament is still pending.

TrendForce sees this adjustment as opening a wider development window for REEVs, positioning them as a transitional solution between plug-in hybrids and fully battery-electric vehicles.

REEVs bridge the gap to full electrification

REEVs share similarities with plug-in hybrid electric vehicles (PHEVs), but with a key distinction. According to TrendForce, the internal combustion engine in a REEV acts solely as a power generator and does not drive the wheels directly. This allows the vehicle to deliver a battery-electric driving experience while producing lower real-world carbon emissions than PHEVs.

Because energy is supplied by both the battery pack and the onboard generator, REEVs also address range anxiety — still a barrier for many EV buyers — while maintaining charging flexibility.

The penetration rate of REEVs in the global new-car market has increased from below 3% to around 4% as of 3Q25, according to TrendForce data.

OEM strategies and supply-chain implications

According to TrendForce, Chinese automakers currently dominate the REEV market, leveraging cost advantages in vehicle manufacturing and batteries. Key players include Seres Group, Li Auto, and Changan Automobile Group. However, European OEMs are preparing to respond. TrendForce notes that BMW, Volkswagen, Volvo, and Stellantis have announced or are expected to launch REEV models in 2026, using the technology as a bridge until the pure EV market matures. Toyota and Hyundai have outlined similar approaches.

From a supply-chain perspective, REEVs integrate an ICE, a power battery, and a fully electric drivetrain. According to the release, higher REEV penetration will benefit suppliers across all three domains, including silicon carbide power components, whose mainstream power ranges align closely with REEV requirements.