Opinion: is this the end for the cheap, small city car?
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Young folk often start their driving careers in tiny A-class (or city) cars, exemplified by the Volkswagen Group’s VW Up, Seat Mii and Skoda Citigo. Cheap to run and easy to park, they’ve been popular with young and old alike, but that’s about to change.
Ford, Peugeot Citroen, the VW Group and others are having doubts about the economics of producing these tiddlers, which also make small profits. In the meantime, pure electric and plug-in hybrid is being introduced in bigger and more expensive cars aimed at wealthy middle classes but battery-electric small cars are terrifyingly expensive; there were several at the show with prices in excess of $50,000.
Luca De Meo, chief executive of VW-owned Spanish car maker, says that making even a larger, B-segment car with a viable price tag is a tough call, saying it’s unlikely to happen for 10 years, until battery packs have parity with conventional internal combustion engines.
“Zero CO2 is a target worth fighting for,” he says, “but it’s a huge stress for our company; as for 30,000 euro B-class cars at the show – pah!”
Carlos Tavares, the chief executive of PSA which owns Peugeot-Citroen and Opel/Vauxhall, which was introducing its new Corsa small hatchback (which is popular with young people), put it more strongly.
“One of your colleagues asked about the economics of small cars the other day, and it’s simple, you need to look at the way the CO2 legislation structure is written; the lighter the car, the more demanding the CO2 regulation, so small cars are very demanding on CO2 and the only way is to get rid of the ICE [internal combustion engine] in them.”
That would mean building battery-electric small cars, but as Tavares points out, in such small cars with such low price tags, “the battery can be up to 70 per cent of the cost of the car. So you are going to see a segment of cars [the A-sized cars] that are going to disappear because if you put a price on them to make them sustainable, that’s a price that young people can’t afford”.
So it’s bye bye small cars – and that’s a tragedy. A few years ago car makers were moaning that young people weren’t buying cars any more and now the latest EU regulations are pricing those that still do off the road. And, as Tavares questions, just how polluting are these small, low-mileage cars which bring such freedom and independence to people at the start (and end) of their driving lives.
“The reality is,” he says, “that if you only look at tail-pipe emissions and not the vehicle’s life cycle, then you are never going to see the true environmental cost to the environment. And there is no European agency at the moment which co-ordinates and counts these things. I also learned the other day that the rate of mandatory CO2 reduction in the energy generation sector is much less than that required of the motor industry.”
He shrugs... “Our ability to coordinate is not there.”
- Telegraph UK