Electric cars increasingly avoided? – Companies

A curious phenomenon is developing around the electric car. The more widespread it is in the country, the smaller the share of the population interested in buying it.

This year, at the end of August, more than 22,000 battery-operated cars were registered. But research by the Mobia association (1) shows that purchase intentions have melted. While in 2021, 51% of respondents were ready to purchase this type of vehicle, that number has dropped to 40% this year.

First reason: very high prices

The first reason behind this skepticism? This is by far the considerable price of these vehicles. It was expected to decrease with increasing sales volumes. But in recent months, the opposite has happened. Prices increase, directly or indirectly, with the removal of basic models from the catalogues. So much so that an average, “compact” car such as a VW ID.3, a Renault Mégane or a Hyundai Kona (with a range of 400 km, suitable for all uses) is displayed at 45,000 euros, or at least 10,000 euros at more than their gasoline cousins. The novelties mainly concern high-end models. On the second-hand side, the supply is low and often very expensive. These fees are beyond the average buyer’s financial capabilities. And we’re not talking about the uncertainties about the cost of recharging in these times of exploding energy prices.

However, public authorities are pushing for the purchase of these vehicles, and will even make them mandatory in the long term, for environmental reasons. In the European Union, this will be the case from 2035 onwards for the sale of new cars. In Brussels, fuel-powered cars will not be allowed to drive on the streets of the capital from the same year. The current increase in sales here is explained by the demand for company cars, driven by a very favorable tax deduction. But private buyers don’t care about these advantages, they only account for 10% of electric car purchases.

The Chinese solution and threat

Manufacturers cite shortages of some components and rising raw materials to drive up prices and limit supply to more expensive models with better margins. They are playing with fire and risking throwing open the door to the impending Chinese competition. In recent months, the MG brand (SAIC groups, one of the main Chinese manufacturers) has been offering electric cars at the price of fuel cars, 5,000 to 10,000 euros cheaper than their European equivalent. Other brands like BYD, NIO or Great Wall announce their arrival.

This is a clear threat to European industry. Some of the public won’t risk buying these little-known brands, but those prejudices can quickly fall away with word-of-mouth, which is very good for MGs. Belgium was once a big consumer of Russian-made Lada, rudimentary but so cheap. China is also very advanced in electric car and battery technology, with some European manufacturers sourcing from there.

The imminent risk is clear for European industry. Various protectionist measures could be taken, it is said in France. They would be disastrous if they were to protect the high prices of European models and keep the battery-powered car inaccessible to the majority of the population.

(1) Mobia is a joint initiative of Febiac (car importers), Traxio (car/truck distribution and services) and Renta (leasing) federations.

This year, at the end of August, more than 22,000 battery-operated cars were registered. But research by the Mobia association (1) shows that purchase intentions have melted. While in 2021, 51% of respondents were ready to purchase this type of vehicle, this number has dropped to 40% this year. First reason: excessively high prices The first reason behind this skepticism? This is by far the considerable price of these vehicles. It was expected to decrease with increasing sales volumes. But in recent months, the opposite has happened. Prices increase, directly or indirectly, with the removal of basic models from the catalogues. So much so that an average, “compact” car such as a VW ID.3, a Renault Mégane or a Hyundai Kona (with a range of 400 km, suitable for all uses) is displayed at 45,000 euros, or at least 10,000 euros at more than their gasoline cousins. The novelties mainly concern high-end models. On the second-hand side, the supply is low and often very expensive. These fees are beyond the average buyer’s financial capabilities. And we’re not talking about the uncertainties about the cost of recharging in these times of exploding energy prices, but the government is pushing for the purchase of these vehicles, and will even make them mandatory in the long term, for environmental reasons. In the European Union, this will be the case from 2035 onwards for the sale of new cars. In Brussels, fuel-powered cars will not be allowed to drive on the streets of the capital from the same year. The current increase in sales here is explained by the demand for company cars, driven by a very favorable tax deduction. But private buyers are not affected by these advantages, they only weigh 10% of electric car purchases, high, and limit the offer to more expensive models with better margins. They are playing with fire and risking throwing open the door to the impending Chinese competition. In recent months, the MG brand (SAIC groups, one of the main Chinese manufacturers) has been offering electric cars at the price of fuel cars, 5,000 to 10,000 euros cheaper than their European equivalent. Other brands like BYD, NIO or Great Wall announce their arrival. This is a clear threat to European industry. Some of the public won’t risk buying these little-known brands, but those prejudices can quickly fall away with word-of-mouth, which is very good for MGs. Belgium was once a big consumer of Russian-made Lada, rudimentary but so cheap. China is also very advanced in electric car and battery technology, with some European manufacturers sourcing there. The risk ahead is clear for European industry. Various protectionist measures could be taken, it is said in France. It would be disastrous if they were to protect the high prices of European models and keep the battery-powered car inaccessible to the majority of the population.(1) Mobia is a joint initiative of the federations Febiac (car importers), Traxio (car/truck distribution and services ) and Renta (leasing).

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