The boss of global vehicle producer Renault has called on manufacturers to promote small affordable petrol and diesel cars rather than expensive and heavier electric vehicles which he described as “environmental nonsense”.
The carmaker's CEO Luca de Meo stated that smaller cars with an internal combustion engine would help reduce the carbon footprint of urban vehicles.
In his "letter to Europe", the Renault chief warned that the car industry could be in real danger without immediate support and intervention.
The promotion of smaller vehicles, de Meo stated, would help encourage consumers to buy these vehicles through bonuses and benefits such as cheaper parking and reserved charging points.
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Renault warned that the car industry could be in real danger without new measures
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In the letter, the Renault boss said: “Driving around every day in an electric vehicle weighing 2.5 tonnes is clearly an environmental nonsense.
“The problem is that European regulations have had a negative impact on the profitability of the small car segment, with sales falling by 40 per cent over twenty years.
“To find a solution, we should take our inspiration from Japan and its small urban vehicles. From the factory to end-of-life, the environmental impact of a small car is 75 per cent lower.
“It can be sold at half the price of a mid-range model. We could rapidly reverse the current trend with an array of inexpensive measures: social leasing, free parking spaces, preferential charging prices, lower interest rates on loans, incentives for young buyers, and so on.”
Renault highlighted how in the space of twenty years, the average price of city cars has surged from €10,000 (£8,539) to €25,000 (£21,349) with the annual budget for consumer mobility (fuel, servicing, insurance and tax) soaring from €3,500 (£2,988) to €10,000 (£8,539).
Over the same time period, the average salary rose by just 37 per cent resulting in the middle classes turning away from cars, Renault warned.
In Europe, car sales fell from 13 million units to 9.5 million between 2019 and 2023, with the Covid pandemic having a
Smaller cars would also significantly improve air quality in cities, de Meo added, with 39 per cent of emissions being caused by road traffic.
They would also be an ideal alternative in the international market with compact cars between 20 and 30 per cent cheaper than larger vehicles.
Smaller vehicles could create a growth surplus for Europe of roughly €500million (£426million) in GDP per year and create over 10,000 jobs in industry.
CO2 emissions from small commercial vehicles, Renault estimated, is at 74 million tonnes in Europe.
The proposals put forward by Renault are ambitious but practical, the company remarked. It shows that the European automotive industry could rapidly emerge as the solution to the challenges facing the continent.
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CO2 emissions from small commercial vehicles, Renault estimated, is at 74million tonnes in Europe
RENAULTDe Meo warned that working together is vital, for competitors and for industrial sectors as the prosperity of Europe is at stake.