Road transportation accounts for the majority of freight transport in Europe. According to Eurostat, over 75% of inland cargo transports within the EU, i.e., about 1,750 billion metric ton-kilometer (tkm), travel by road. In some European countries, this percentage goes as high as 90%, or more. The primary factor driving the growth of the market is the increased preference for pickup trucks and small vans over heavy-duty trucks and railways for logistics.

Additionally, the rapidly growing e-commerce in Europe represents a central pillar for the digital single market and reflects the advancements in the e-tailing sector, which is witnessing the expansion of well-organized retail spaces. As the e-commerce industry continues to grow across Europe, the demand for a more advanced distribution network is increasing. The last-mile delivery companies are investing in electric vehicles to make their existing fleet more fuel-efficient. For instance, In 2020, Arrival an electric van manufacturer has won a USD 428 million order from United Parcel Service (UPS) for 10,000 vehicles. UPS is also planning to buy an equity stake in the startup, Arrival has already received over USD 100 million funding from Hyundai and KIA.

Similarlymajor delivery companies, such as FedEx, DHL, Harrods, Hermes, etc., switching to electric light commercial vehicles. Mercedes is planning to enter the electric van market by introducing electric vans for the German logistics firm, Hermes. In one such move, the German postal service, DHL, fabricated its own electric vehicle for operations in the country.

Registrations of new light commercial vehicles in the European Union reached 2.1 million units in 2019, a 2.8% year‐on‐year increase. The new WLTP emissions test was introduced for vans in September 2019has provided a boost in the demand of Van in the last quarter of 2019. Vans contribute to 80% of the total light commercial vehicle sales in Europe. They are used for a wide range of commercial activities, such as construction, postal and courier services, ambulance services, policing and rescue operations, mobile workshops, and passenger transportation.

In 2019 diesel-powered vans account for 92.8% of the new registration in the European Union, followed by those powered by petrol with 4.4% and alternative fuel vehicles with 1.3%. Diesel engine vans are used because of their high torque and efficient load carrying and towing capabilities.

Currently, there are over 32 million vans in use in the European region. The average age of a van is rising and has increased to 11 years. Europe is also one of the largest exporters of vans. The demand for European vans is mainly driven by the increase in logistics activities. During 2019, the region exported 362,200 vans to several locations across the world.

Whereas Europe is gaining traction in the market with the help of electric vans, major players in the market are launching new electric vans for this region. For instance,

In 2019, Peugeot has announced the addition of a fully electric van called the e-Expert in its electric vehicles portfolio. This electric van will hit the European market by second half of 2020, with the choice of a 50 or 75kWh battery.