by The Affordable Car Crisis in Europe
Sales of affordable compact cars in Europe are plummeting – from 1 million to just 100 thousand units per year. Manufacturers Stellantis and Renault are calling on European regulators to review regulations to make the production of small cars profitable again. They propose creating a separate category, similar to Japanese Kei cars.
Stellantis Chairman John Elkann notes that over 25% of the company’s engineers are engaged solely in complying with regulatory norms, which complicates the development of new models. He believes Europe needs its own category of compact electric vehicles – “E-Cars”.
“We are facing over 120 new regulations by 2030. If you look at our engineers, more than 25% are working only on compliance, not adding value,” – John Elkann.
Challenges for Manufacturers
Former Renault CEO Luca de Meo (who recently resigned) also supports this initiative. He emphasized that the daily use of heavy electric vehicles weighing 2.5 tons is an “ecological nonsense”. In his opinion, Europe needs compact cars for urban trips and deliveries.
Stellantis currently offers several compact models, such as the Citroen Ami, Opel Rocks-e, and Fiat Topolino. However, these vehicles are classified as quadricycles, which limits their capabilities. Researchers at Gerpisa believe that allowing the sale of Kei car analogues will help European brands compete with Chinese manufacturers.
The situation with affordable cars in Europe mirrors a global trend – the market is shifting towards larger and more expensive models. However, rising energy prices and the needs of urban mobility may force regulators to reconsider their approach to vehicle classification. This is especially relevant against the backdrop of growing competition from Asian manufacturers, who are actively developing the compact electric vehicle segment.
