Car makers call for clarity on EU's small car proposals

European car makers are pleading for speedy clarification on proposals published in December designed to ease the path to full electrification, with specific focus on the new small-car category. Car makers including Renault and Stellantis have largely welcomed the proposed changes, which include allowing some combustion engine sales after 2035. However the detail remains thin on the ground and the Car makers are concerned that proposals that superficially offer a leg-up might be harder to achieve in reality. Fabrice Cambolive, head of the Renault brand, told Autocar: “What I would like now is not a change in the direction of what they announced, but a clarification of what they announced.” One of the biggest potential boosts to European car makers is the planned new small affordable car initiative that creates a new M1E subcategory for EU-built electric cars under 4.2 metres in length. Selling one of these cars would generate its maker 1.3 EV credits, creating a useful pressure valve in the battle to continue with combustion engine vehicle sales without racking up unsustainable fines for not hitting CO2 targets. Meanwhile the EU has also said it will “take into account the proportionally higher impact on development costs that new requirements can have on small electric vehicles”, when applying future regulations, generally referred to a ‘freeze’ on future rules. Individual countries and cities including those not in the EU like the UK could also offer incentives to M1E vehicles, like reduced parking charges or scrappage bonuses. Emanuele Cappellano, Stellantis' new head of Europe, said: “It’s a good initiative. It goes in the right direction.” Cappellano’s “point of contention” was around EU content plans, which could end up working against the aim to make the cars more affordable. He said: “The EU should define a way to gradually increase the supply chain instead of trying to impose a EU source.” The idea behind the European Union’s small car initiative is to help car makers but also protect EU jobs by ensuring that any qualifying model is both built in the bloc and has lots of local content. So far the parameters haven’t been defined, but car makers are nervous that the initiative will clash with a long-held strategy to outsource production and parts supply of cheaper models to cheaper countries. Some cars will be likely be fine, for example the Renault 5 and associated models built at the company's Douai, northern France plant, using batteries from the nearby AESC plant. Others get more complicated. The Fiat Grande Panda, for example, is built in Serbia – outside the EU – but will it have enough EU built parts to qualify? Chinese parts are almost a given these days, and big parts including batteries and electric motors would account for the majority in percentage value calculations. But could an exemption be made for cars built in the EU with an agreed timetable to switch to EU parts? The complexity of such a calculation could play into car makers’ hands. Katrin Adt, CEO of Dacia, told Autocar: “I think it would be good not to have it by car, but on a fleet. The easier it is to calculate the better it is.” That would help Dacia in that its Spring small EV comes from China, while other key models are built in the EU. Renault says it tries to keep its parts suppliers close to plants. Renault's head of product, Bruno Vanel, said: “We are talking about 1,000 kms around the assembly plant, which means that when we are localising in Europe, we are localising also our supplier space around that.” Freezing or slowing regulations is another key hope for car makers on small cars as they try to control rising costs, even if safety groups are pushing back on proposals. European Transport Safety Council said it was “deeply concerned” by the European Commission’s approach to small car safety timelines and accused them of “unprecedented reliance on industry demands”. Other carmaker concerns revolve around the proposals that the few combustion-engine models that are allowed post 2035 are made with low-carbon ‘green’ steel, a rare commodity so far, or run on e-fuels or biofuels, which would be tough to implement. Whatever the final regulations look like, car makers are keen for them come fast and stay put. Dacia's Adt said: “I think that the most important thing is now to have clarity and to the security to be able to base your decision on something which is reliable for the next years ahead.”

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Car makers call for clarity on EU's small car proposals

Renault and Stellantis have welcomed proposed rule changes but details remain scarce

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Car makers call for clarity on EU's small car proposals

Renault and Stellantis have welcomed proposed rule changes but details remain scarce

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