In Europe, the prices of ICE cars are rising while electric cars are getting cheaper. Manufacturers have started adjusting costs to encourage sales of "battery" cars, Reuters reports. The reason is the new requirements of the European Union, which come into force on January 1, 2025. From now on, at least a fifth of sales of most brands must come from electric vehicles. Otherwise, they face large fines.
Peugeot raised prices by 500 euros for the entire model range, except for fully electric cars. Renault, on the other hand, only some ICE cars increased in price: for example, the price of the Clio SCE 65 increased by 300 euros. Both companies claim that the price adjustment is a consequence of inflation. On the other hand, Volkswagen reduced the price of the ID.3 in several markets. In Germany, this model now costs less than 30,000 euros.
According to new environmental regulations, about 22 percent of cars sold by brands must be electric. So far, according to calculations by the European Automobile Manufacturers' Association (ACEA), European brands are very far from this indicator: electric cars account for only 13 percent of all sales.
Only three companies operating in the region - Volvo, SAIC and Tesla - will be able to avoid fines. The rest will have to pay 15 billion euros. The main blow will fall on the Volkswagen Group, whose position is already difficult: the sanctions are estimated at 7.7 billion euros. Next is the Renault-Nissan-Mitsubishi concern with 1.7 billion, followed by Stellantis with 1.6 billion euros.
The price cuts, designed to increase demand for electric cars, which are not cheap to produce, will cost the companies dearly. The demands are intensifying amid the crisis in the industry, with Europe's largest manufacturer VW planning wage cuts and factory closures, and tens of thousands of its employees on strike.