Carmakers embrace an electric future at Paris motor show


From Financial Times, Peter Campbell and Michael Stothard
To the sound of pounding music and the flash of photography, the covers glided off Volkswagen’s latest creation at the Paris motor show: an affordable electric car that can drive for more than 350 miles on a single charge.

In the hours that followed, carmakers including Renault, General Motors’ Opel and Daimler’s Mercedes-Benz also unveiled electric models, highlighting how the trade fair was dominated by the race towards battery-powered cars for the mass market.

The intensifying competition in this area comes as diesel, the most popular source of power for engines in Europe’s cars, faces tough questions over its long-term viability because of concerns over emissions of harmful nitrogen oxides.

The concerns, brought into sharp focus by the Volkswagen emissions scandal last year, have led to predictions that diesel’s grip on the European market will slide in the coming years as consumers and regulators turn against the fuel because of its role in air pollution, and links to respiratory diseases and premature deaths.

A study by AlixPartners, a consultancy, predicted in June that diesel cars’ market share in Europe will fall from 50 per cent today to as little as 9 per cent by 2030.

Carmakers are openly talking about when electric cars might outsell diesel vehicles — an unthinkable scenario just five years ago.

Carlos Ghosn, chief executive of Renault and Nissan, expects electric sales in China to surpass diesel in “three to four years”, in a statement reflecting the Chinese government’s willingness to prioritise zero emission technology to tackle pollution.

But in Europe, where carmakers embraced diesel wholeheartedly in the 1990s as a means of cutting carbon dioxide emissions, Mr Ghosn says it will take “much more time” for electric to overtake.

Thierry Bolloré, Renault’s chief competitive officer and second most senior manager after Mr Ghosn, says: “It is clear that for the [hatchback] cars you still may have maybe a diesel power train for [company] fleets, or for people who are permanently driving on motorways.”

However, he suggests electric power will be more competitive than diesel in smaller cars because of the rising costs of compliance with environmental regulations.

Renault, together with Nissan, currently sell half of the world’s electric cars, and Mr Bolloré says consumers like the experience of battery-powered vehicles, as well as the “cleanness of the air”.

One carmaker stood out at the Paris show by publicly ditching diesel for its latest model.

Toyota will not offer this fuel option when the C-HR, its small sport utility vehicle, goes on sale next year. The Japanese carmaker’s decision “underlines the rapid shift under way from diesel to electric power”, says Stuart Pearson, analyst at Exane BNP Paribas.

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