The Peugeot vehicle assembly line at the Stellantis NV auto plant in Sochaux, France, on Thursday, Oct. 3, 2024. Stellantis is struggling with slowing and more competitive auto markets across Europe, where electric-vehicle demand is waning. Photographer: Nathan Laine/Bloomberg
PARIS: Europe’s biggest automakers have long used the Paris auto show to trot out fresh designs and new technologies.
This year, there’s a different theme: price.
With drivers balking at the high cost of owning electric vehicles (EVs), Stellantis NV, Renault SA and Volkswagen AG plan to showcase their latest budget EVs at the biennial event that starts today.
Their aim is to turn around a slump that started last year when governments began pulling back incentives to ditch combustion engines.
The stakes are high for the new models to succeed.
Chinese rivals led by BYD Co are gaining market share in the region with cheaper models.
And if the European carmakers fail to sell more EVs, they’ll be on the hook for as much as €15bil in fines for failing to meet stricter fleet emissions-reduction targets.
“The mood is not great around EVs right now – there’s not enough charging infrastructure, there’s volatility on price, but let’s see,” Renault chief executive officer Luca de Meo said. “We are really trying our best,” de Meo added.
Renault is at the forefront of the affordability push, unveiling plug-in models in Paris including the R4, which is expected to cost less than €35,000 or about US$38,269.
It’s also showing off the new R5, a €25,000 electric version of a 1970s gasoline car that offered fuel-efficient transport during a time of soaring oil prices.
The show could mark a turning point for Europe’s automakers, which have struggled to produce cheap EVs.
Early problems developing software, high labour costs and persistently expensive components like batteries have plagued the industry.
To keep margins up, many carmakers focused on selling premium models. That, together with the removal of subsidies in countries including Germany and Sweden, pushed the average EV price above €45,000 this year.
That’s put electric models out of reach for many Europeans, who are already trying to cope with higher borrowing and living costs.
The European incumbents are going up against several Chinese manufacturers eager to expand in the region despite Brussels’ decision this month to boost tariffs on their EVs as high as 45%.
BYD is bringing EVs and plug-in hybrids to Paris including mass-market models competing with the French and German cars as well as Tesla Inc’s Model Y.
In a bid to demonstrate its technology prowess, BYD also will be showcasing the Yangwang U8, a luxury SUV costing around one million yuan or about US$141,509.
Guangzhou-based Xpeng Inc, which has a partnership with Volkswagen, will present its upcoming P7+ sedan, a longer-wheelbase version of the €50,000 P7 that competes with more expensive mid-sized models from BMW and Mercedes.
While manufacturers including Great Wall Motor Co and Nio Inc are absent from the show, a number of Chinese automakers have sent their staff to Paris to discuss potential partnerships, market entries and European production with local manufacturers and dealers.
Stellantis is tapping China’s Leapmotor to bring down the cost of its electric cars. Models presented in Paris include the Leapmotor B10, a compact SUV aimed at younger drivers that’s expected to undercut competing models on price.
The reception at the show may determine next steps for Stellantis’ push to produce Leapmotor vehicles at a group plant in Poland. — Bloomberg
