For some time now, the CEO of Renault, Luca De Meo, has been talking about the effects of the irruption of Chinese electric models in the European automotive market, but he had never been as forceful as yesterday. In an extensive 20-page letter sent “to Europeans” on the occasion of the June elections, he identifies China as the major threat to the continent’s automotive industry and asks the European Commission to stop regulating and focus on promoting a common strategy “The prosperity of our continent is at stake”, he says.
The current moment is characterized, he says, by China’s “rapid advance” in the electric car market thanks to its “huge domestic market” and the strategic planning of its rulers. Last year, about 35% of electric vehicles exported worldwide were Chinese, while European imports of such products have increased fivefold since 2017. Chinese brands MG and BYD were the biggest exporters on a global scale.
The diagnosis of Renault, one of the main car manufacturers in Europe, is that the European Union is at a “disadvantage” because it is dedicated to “regulating”. The result is that, due to regulations, their vehicles are now comparatively more expensive. The production cost of a Chinese electric car is around 25% lower than that of a European electric car, he explains.
De Meo, who declares himself a pro-European and who says he is on the sidelines of political positions, remembers that the European automotive industry employs 13 million people and is one of the most innovative activities. In terms of tax revenue alone, it brings in around 392,000 million euros each year. However, decarbonisation requires investments of 252,000 million from manufacturers in just three years without guaranteeing success, in view of the “counterproductive” proliferation of rules. “It generates a real accumulation of rules”, which “penalizes the competitiveness of companies”, he says.
The scenario drawn by the Italian director – before running Renault he was CEO of Seat – can also be applied to Spain. A model from the Chinese MG has been the best-seller on the local market for months, while the production of electrified vehicles fell by more than 25% in the first two months of the year, according to data released yesterday by Anfac.
Among the measures that De Meo calls for is the creation of a European industrial strategy that follows “the Airbus model”, capable of unifying efforts. It also asks to rebuild the supply capacity of raw materials and electronic components.
The director is also in favor of involving the 200 largest cities in Europe in a joint mobility plan, of creating a kind of industrial “League of Champions”, of encouraging small electric vehicles and unifying the manufacture of batteries.
