2026 will be a stress test for the auto industry: it is not vision that decides, but scalability, costs and resilience.
2026 will be a year in which many developments that have long been technologically prepared will have to demonstrate for the first time under real conditions whether they are viable. What matters is less what is possible and more about what can be scaled. Additionally, geopolitical disruptions will continue to play a key role in how the entire industry fares this year. But new technologies will also cause a stir.
Battery startups on the verge of a big breakthrough
A good example is sodium batteries, which will find their way into cars. But in 2026 they will not appear as a miracle solution that replaces lithium overnight. Their importance lies elsewhere: in the costs, availability and resilience of supply chains. The technology becomes relevant where weight and energy density are secondary – in smaller vehicles, fleets or stationary applications. Investments in these and other new battery technologies will increase, creating new opportunities for EU startups.
At the same time, the much-cited de-risking of China is becoming concrete for the first time. The term will become a key part of the strategic direction of the industry in Europe in 2026. Companies that diversify supply chains gain resilience, but at the cost of increased complexity and lower margins. De-risking is not free insurance. In 2026 it will become clear which companies can bear this additional burden – and which cannot.
The fact that Chinese manufacturers continue to push into the European market is not a contradiction. With BYD’s start of production in Hungary, the strategy shifts from export to anchoring. Chinese manufacturers no longer act as external challengers, but as part of the European industry.
China dominates the strategy
This will also mean that the Chinese supplier industry will push more strongly into the market. Overproduction in China demands this from these companies. This will put even greater pressure on the supply industry in Germany in particular. The question will be whether and how governments will react. Protectionism against structurally better positioned competitors will become an issue.
But economic pressure on the auto industry is also building in China. Starting this year, the vehicle purchase tax on electric cars will be gradually lifted. So far, electric cars are exempt from this, which reduces the price by an average of 10 percent. From 2026 you will have to pay 5 percent more.
Without government support, demand will become more volatile and price wars will become fiercer. Manufacturers have to prove that their electric models can survive without political support. 2026 will be the first real stress test for the marketability of electric mobility in China.
Autonomous driving will scale
Autonomous driving will become more important worldwide. With players such as Baidu, Waymo, Pony.ai and Moia, the first attempts to operate autonomous vehicles not only technically but economically will also begin in Europe in 2026. It’s less about whether the systems work, but rather whether operation, maintenance, software, insurance and user acceptance can be brought together in a meaningful way. Autonomous mobility will not start across the board, but rather where it has a clear benefit. 2026 is not a verdict on autonomous driving – it is a learning year for scaling it.
In the end, all of these developments are united by a common question: Can what has been announced in recent years actually be implemented? 2026 will not be a year of great stories, but one of testing. It is not the loudest concepts that will survive, but the most resilient ones.
