Emissions regulations threaten to "wipe out" small cars in Europe

More stringent emissions regulations and safety standards appear in developing markets, the compact and minicar models will be greatly affected because the cost of complying with new regulations will be too high for many vehicles. Small is cheap. Although it may seem paradoxical, bigger and more polluting cars will survive when the European Union attempts to reduce CO2 emissions for each new car to 95 g / km in 2021. Failure to meet the goal will put manufacturers at risk of paying billions of euros in fines.

The fact that small cars are difficult to "survive" is simply because to reduce emissions even more, manufacturers will have to add more expensive technologies. Low profits of compact cars and minicars will not be enough to compensate. Besides, the target of 95 g / km does not apply to all manufacturers. The exact target for each manufacturer in the EU is calculated based on the average weight of the company's product portfolio. Therefore, automakers such as Fiat and Peugeot, which produce a lot of compact cars, will have a harder responsibility with targets of 89.8 g / km and 91.1 g / km respectively. This figure for BMW 99.6 g / km.

Emissions regulations make it difficult for small cars

European minicars such as the Smart Fortwo, Volkswagen Up or even the Renault Twingo will almost certainly not survive after applying this rule. The slightly larger compact cars like Volkswagen Polo or Ford Fiesta are also at risk of death. Daimler has stopped investing in Smart brand because next-generation cars will no longer be manufactured in Europe but in China with partner Geely. Volkswagen is also said to be planning to launch Up! Next generation as a fully electric car.

Emission regulations make small cars turn into clean cars

In addition to stricter emission regulations, European safety standards will also be revised in 2021. Accordingly, new models must be equipped with a range of camera-based driver assistance technologies. including automatic emergency braking. This will definitely increase the price of cars. According to an Automotive News Europe report, Ford estimates that meeting new standards will increase by 2,000 Euro for the price of each new model. Thomas Ulbrich - Volkswagen board member - said: "Customers who buy minicar cars are paying the price of 12,000-14,000 Euro (314-367 million). However, in the future, when the car is electrified, the price will be 18,000-20,000 Euro. This will be a problem. ”

Air emission regulation makes small car prices unattractive

Car manufacturers plan to replace low-end models with fully electric vehicles in the automotive market. However, this model still doesn't generate a big profit when the majority of electric vehicle sales at this time is thanks to government subsidies or incentives. Roelant de Waard, Ford's retail manager in Europe, said: "Producing a model of electric car for € 10,000 will be very difficult. Battery costs are still a major obstacle because each car needs at least $ 4,000 (Euro 3,554) to equip the batteries. "

Next year, the fully electric Honda E will come out while Mazda will introduce its first electric car. Volkswagen is also about to launch ID.3 running entirely on electricity. Although these models will be considered cheap, no products are expected to cost less than 20,000 Euro. LMC Automotive Consulting predicts that the European compact market will drop from 3.16 million units last year to about 3 million next year and maintain this level until 2023. For minicars , sales will fall from 1.1 million units last year to 900,000 units by 2021.
Emissions regulations threaten to "wipe out" small cars in Europe Emissions regulations threaten to "wipe out" small cars in Europe Reviewed by Charlotte Bryant on February 01, 2016 Rating: 5

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