Renault Boss Wants Europe To Make Kei Cars And Pay More Attention To E-Fuels

Luca de Meo, Renault’s chief executive, has raised eyebrows this week by penning a lengthy open letter addressed to the European Parliament ahead of its June 2024 elections. The key theme is his dissatisfaction over a perceived disadvantage held by Europe compared to the Chinese and American automotive industries. 

We’ll revisit that soon, but first, there’s one particular part of the letter that caught our eye as car geeks - a surprise ode to the Japanese Kei car. De Meo reckons that right now, something like that sector is just what Europe needs.

De Meo blames European regulation for the profitability of the small car segment, with a sales drop of 40 per cent over the last two decades. Small cars can be very green, whereas  “Driving around every day in an electric vehicle weighing 2.5 tonnes is clearly an environmental nonsense,” he says.

“To find a solution, we should take our inspiration from Japan and its small urban vehicles or ‘kei cars’,” de Meo adds. “From the factory to end-of-life, the environmental impact of a small car is 75 per cent lower. It can be sold at half the price of a mid-range model. We could rapidly reverse the current trend with an array of inexpensive measures: social leasing, free parking spaces, preferential charging prices, lower interest rates on loans, incentives for young buyers, and so on.”

For the uninitiated, a Kei car must be less than 3.4 metres in length and 1.48 metres in width, and have a displacement limit of 660cc. Owners benefit from cheaper tax and insurance and aren't bound by the same parking rules as larger cars.

De Meo also uses the letter to address the potential of synthetic fuels. “The e-fuels solution, for example, is highly promising and should be further explored,” he says, adding, “Our proposal is that we should measure the impact of a car over its entire life cycle, from assembly to end-of-life and recycling, rather than focusing solely on energy consumption during use”. The use of hydrogen also gets a nod from the Renault boss.

As mentioned, though, a good chunk of the letter concerns “an imbalance in competition”. He says his issue is over China handing over massive subsidies to its domestic manufacturers, while in the US, the OEMs are enjoying billions of dollars of green tax credits. And what do European manufacturers get? Increasingly tough regulations.

De Meo wants to see an end to "the continuous rollout of new standards, fixed deadlines and threat of fines for non-application." He adds, “This means no longer dictating ‘technological’ choices to industry. It means setting goals for industry but not how to get there.”