Norway’s new auto tax by weight could have an adverse effect on the sale of battery-electric vehicles in a market where Tesla Inc TSLA is the leader.
What Happened: Tesla’s electric vehicles dominate the Norwegian market, where four out of five new cars sold in 2022 were BEVs, reported Reuters.
Tesla was the market leader for the second year in running and sold more cars than any other brand, garnering a 12.2% share of the overall market, according to the report.
While BEVs have been tax-exempt until now, the government in Norway imposes taxes on internal combustion engine vehicles.
See Also: How To Buy Electric Vehicle (EV) Stocks
Tesla CEO Elon Musk has praised Norway’s leading role in electrification as the country seeks to completely abandon sales of gas-powered vehicles.
Earlier on Sunday, Musk thanked the people of Norway for "incredible support of electric vehicles." He said, "Norway rocks!!"
Musk's comments came in reaction to a Twitter post that said Tesla had exhausted its supply of cars for Norway as 2022 drew to a close.
Why It Matters: The new auto tax based on weight could affect the sale of BEVs as they are heavier than their ICE equivalents.
“The electric car has become the new normal car for Norwegians, and that means we have to look into how we are using society's funds,” said a Norwegian transport ministry official in response to the tax, according to Reuters.
Norway has emerged as the country with the highest proportion of EVs due to ample subsidies, which have reportedly cost Norway NOK 39.4 billion ($4 billion) in lost revenue in 2022.
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