Bringing down the price of new cars must become a European priority, despite Euro NCap

35024.png

 The growing concern about new car prices and the ability of the European car industry to still appeal to households is well founded. This week it has come up against the contrary objectives of Euro NCap. This should be an opportunity to review a number of trade-offs that have prevailed for more than 20 years in this industry and which it seems urgent to revise.

The news at the beginning of December saw the Euro NCap offensive against Renault, which Florence Lagarde analysed for us on Thursday, intersect with the publication of figures for new vehicle registrations by households, which the Cetelem automobile observatory underlined as being at an exceptionally low level in relation to the evolution of new vehicle prices.

The observation already made by Marc Bruschet, president of the CNPA dealer branch, deserves to be placed at the heart of the analysis of what is happening in Europe and, depending on the interpretation of the figures and trends, resisting the political enterprise of the Euro NCap lobby will then appear important or not.

In fact, in India as in Europe, the approach developed since Logan by Renault has always been seen as a challenge to this bizarre Euro NCap system which claims to be doubling the authorities by giving manufacturers good and bad points and by promoting the battery of devices that they invent year after year to improve the passive safety of vehicles.

Where many accident experts would stress that discipline, controls, education and speed limits remain the safest and most equal means of reducing the number of deaths and injuries on the roads, the crashers - and the FIA, which has participated in the creation of these bodies, is quite obviously in the camp of the lovers of cars and speed - are what we might call 'techno-solutionists': for them, all the problems are technically soluble; all that is needed is to add an airbag, a reinforcement, an ABS.

Thus, if certain accidents are caused by drowsiness or sleepiness, it is urgent to buy the device that will detect it from the equipment manufacturers, and since some drivers are unwise enough to get behind the wheel while drinking, it is urgent to generalise the devices that will prevent the vehicle from starting if the person who is about to drive is positive. Insofar as it is a question of saving lives, it would be unfortunate not to have the penny-wise and pound-foolishness to incur these expenses as a manufacturer or as a family man.

Clearly, there is no limit to this game. We are in the "always more" business and what was reserved for the BMW 7 Series or the Mercedes S Class should no longer be optional and should also concern the Fiat Panda and Dacia Sandero. If the European authorities are slow to offer equipment manufacturers the market of 16 million cars that they can dream of for their tyre pressure sensors or anti-sleep devices, Euro NCap is helping them by not giving its stars to those who have not submitted.

The EU, which was quickly recruited by EuroNCap, has been sharing this worldview for years and has been producing regulations that are clearly much easier to digest when selling vehicles at very high unit values than when trying to appeal to households that were previously used car buyers.

When we look at the figures published by ICCT each year, we see that, in current euros, the average price of a European new car rose between 2009 and 2019 from 21,837 euros to 30,485 euros, an increase of 40%. In France, this average unit value is slightly lower and has risen from 20,515 to 27,754 euros (+35%). 2,448 (+20%), the purchasing power of households for new cars has effectively fallen: it took 10.05 months of salary to buy a new car in 2009, it took 11.3 months in 2019 and it will most probably be much worse this year as manufacturers have increased their prices and used their real pricing power to move upmarket and consequently continue to lose a growing proportion of households.

Indeed, as Dacia's experience in Europe suggests, the appeal of the new car is still very strong for used car households: while the dominant obsession is to 'move upmarket' and try to capture the few old rich people who still buy new cars, 'moving downmarket' and offering affordable new cars is an extremely promising alternative.

The result is that, whatever the Euro NCap ayatollahs may think, when a regular buyer of a vehicle between 5 and 10 years old is offered the possibility of switching to a new vehicle, even if it means buying a vehicle that has not been able to qualify for the stars, he or she is given access to a vehicle that is more reliable and better equipped than the vehicle more than 10 years old that he or she was driving.

Obviously, what is already true in France, where households that buy more new cars than used cars are only in the bottom quintile, is even more true in the new EU Member States: for them as for us, the average price of new cars has risen considerably. It is now around 25,000 euros, while the standard of living in Hungary is 25% of ours, in Poland 29% and in Romania 15%. This means that it takes more than 6 years of a Romanian's income to buy a VN and 3 of a Pole's. It is therefore hardly surprising that total purchases of new cars in 2019 in the 13 NMS (over 100 million consumers) were only 1.5 million vehicles.

It so happens that in 2021, with the EPZs and the objective of carbon neutrality by 2050, the automotive world began to take a very serious interest in fleets and not just registrations. It has thus become clear that in order to be within the limits in 2050, we should stop registering thermal vehicles in 2035. If, at the same time, because we need to electrify vehicles and continue to multiply equipment, we continue to allow the weight, size and price of vehicles to drift, we know that the target will not be reached. The frugality that the FIA and Euro NCap hate so much is also what makes it possible to propose - as Dacia does with the Spring - vehicles that do not have 50 kWh batteries but 27.4.

If the aim of European policies is to propose inclusive modes of decarbonisation of mobility that are practicable not only in Norway but also in Romania and/or by the buyers of Tesla, BMW or Mercedes (CUV between 48,000 and 50,000 euros in 2019) but also by those who are content with Fiat (17,400) or Dacia (13,200), then it will become urgent to break with techno-solutionism in order to make arbitrations that will make the necessary reduction in vehicle prices and weights possible.

 

13/12/2021

The weekly column by Bernard Jullien is also on www.autoactu.com.

  GIS Gerpisa / gerpisa.org
  4 Avenue des Sciences, 91190 Gif-sur-Yvette

Copyright© Gerpisa
Concéption Tommaso Pardi
Administration Juan Sebastian Carbonell, Lorenza MonacoGéry Deffontaines

Powered by Drupal, an open source content management system
randomness