The 62nd edition of the Autofestival will kick off on Saturday 24 January in Luxembourg, against the backdrop of a car market undergoing significant change. As vehicle prices remain high, more motorists are turning to the second-hand market. Hybrid vehicles continue to perform well, while demand for electric cars appears to be plateauing. Diesel, meanwhile, has become a niche option.
“The market is recovering, but we are still a long way from 2023 (the year of post-Covid recovery and the Ukraine crisis) and even further from 2019. People are falling back on the second-hand market in droves”, says Manuel Ruggio, Director of Operations at the National Society of Automobile Traffic (SCNA).
Long considered a barometer of Luxembourg’s car market, the Autofestival is eagerly anticipated each year. This year’s edition will show around 60 new models, including a number of previews. Visitors will be able to browse offerings from 90 dealerships and 190 showrooms across the country.
For the automotive sector, the festival is a crucial business driver. “The Autofestival generates a significant volume of sales in the first few months of the year”, notes Ruggio.
The automotive industry plays a major role in the Luxembourgish economy, representing close to 6,000 direct and indirect jobs and contributing significantly to tax revenue. But as Ruggio highlights, the sector has faced considerable turbulence in recent years, which seems to have followed into 2024.
In 2025, the SNCA registered 133,587 vehicles across all categories – an increase of 3.4% compared to 2024. The used car market continues to dominate, with 75,235 second-hand vehicles registered (including 62,017 cars), compared to 58,352 new vehicles (including 47,161 cars). There was a notable rise in the number of vans, up 19% with 4,755 vehicles put into circulation. “This is a return to normal compared to 2024, which was marked by a crisis in the construction sector”, a spokesperson explained.
While the 20th century was defined by the combustion engine, the 21st appears to mark its slow, agony-filled decline. This is particularly true for diesel once the leading fuel in Luxembourg. “Diesel is becoming a niche fuel”, summarises Manuel Ruggiu. In 2025, petrol-powered vehicle registrations dropped by 3.6% to 12,276 units, while diesel fell by 2.4% to just 4,673 units.
Petrol now accounts for 26% of all new registrations (down from 50.6% in 2019), and diesel for just 9.9% (down from 41.9%). Combined, purely combustion engines make up around 36% of all registrations.
Electric motors, on the other hand, are booming. Hybrid models (petrol and diesel) lead with a 29.3% share, followed by fully electric vehicles at 26.9%. Plug-in hybrids, however, are declining, falling from 8.2% in 2024 to 7.9% in 2025.
In other words, SNCA statistics show that 64% of new vehicle registrations in 2025 were electrified.
The good news is that electrification is helping reduce average CO2 emissions, which are set to fall below the symbolic threshold of 100g of CO2/km – reaching 98.9g in 2025, a drop of 0.4% compared to 2024. Back in 2019, the figure stood at over 160g. Luxembourg is therefore one of the few European countries meeting EU targets in this area.
The bad news, however, is that electric vehicle sales appear to be hitting a plateau. “It’s starting to normalise – we’re seeing stagnation”, notes Manuel Ruggiu. The SNCA reports that, for the first time in years, the number of electric car registrations fell slightly from 12,777 units in 2024 to 12,664 units in 2025, a drop of 0.5%. High new vehicle prices, particularly for new electric models, are deterring many motorists, who are instead opting for used cars or other types of engines such as hybrids.
But that’s not the only factor. The Federation of Automotive Distributors (Fedamo) points to the reduction in purchase subsidies from €8,000 to €6,000 as of 1 October 2024.
According to Philippe Mersch, president of Fedamo: “Even though the subsidy remains at a relatively high level, the downward trend is perceived by some customers as a negative signal. At the same time, the decline can also be attributed to a drop in operational leasing contracts for company vehicles most of which are electric. This automatically leads to a decrease in registrations of fully electric vehicles.” Mersch is therefore calling for subsidies to be maintained beyond 30 June 2026 in order to halt the downward trend and preserve the appeal of zero-emission electric mobility.
Another consequence of high vehicle prices is the rising average age of Luxembourg’s vehicle fleet. In 2025, vehicles, including cars and vans, had an average age of 8.3 years, up from 7.4 years in 2019. Nevertheless, the figure remains below that of neighbouring Belgium and France, where the average age easily exceeds 10 years.
The two-wheeler market, meanwhile, remains stable. “It is a market for enthusiasts, which is not too affected by the crisis”, a representative noted. After a record year in 2024 with 2,449 new registrations, the figure dropped by 6.9% to a more typical 2,280 units in 2025. The used market, on the other hand, is booming, with 3,624 sales, which is an increase of 10.9%.
The 62nd edition of the Autofestival will take place from Saturday 24 January to Monday 2 February 2026, with special openings on Sunday 25 January and Sunday 1 February. The AutoOccasiounsFestival will run from Monday 1 June to Saturday 13 June 2026 at participating car dealerships.
