Renault CEO Luca De Meo has raised concerns regarding the current timeline for Europe’s shift to electric vehicles, emphasizing the need to reduce costs to achieve the company’s EV targets. In a recent interview with business daily Les Echos, De Meo stressed the importance of adjusting the schedule to accommodate market realities.
The Critical Role of EV Transition
The transition to electric vehicles is pivotal in combating global carbon emissions. The speed at which this transition occurs will significantly impact both the automotive industry and the environment. Despite the essential nature of this shift, recent EU elections have highlighted a growing demand to reconsider the 2035 ban on diesel and petrol car sales, set for review in 2026, especially given the current dip in EV demand.
Strategic Flexibility vs. Market Realities
“We need a little more flexibility in the schedule,” stated De Meo, who also chairs the European car lobby group ACEA. He cautioned against completely abandoning the EV goal due to the current market slowdown, deeming such a move a strategic misstep. He further elaborated on Renault’s EV production ambitions, acknowledging the challenge of shifting to 100% electric cars by 2035 amidst a weak domestic market. “The truth is we are not yet on the right trajectory to achieve 100% electric cars by 2035. That’s the truth. If customers don’t follow us, we’re all responsible. We need to cut costs,” De Meo remarked.
Challenges in the Automotive Sector
The automotive industry is navigating multiple challenges, including regulatory uncertainties and intense competition from China, which exacerbate the cost-of-living crisis in key markets. While global EV sales surged by 35% in 2023, they saw a decline in 2024. Nonetheless, June 2024 marked a 4.3% rise in new car sales within the European Union, the highest since July 2019, although registrations of battery electric vehicles saw a slight decrease.