Car makers accused of prioritising expensive electric SUVs for profit over small affordable cars

Car makers have been accused of refusing to bring small, affordable electric cars to market because they want to prioritise expensive battery-powered SUVs that make them bigger profits.

Manufacturers could sell compact electric vehicles (EVs) built in Europe for £21,000 and still pocket a profit but instead are focusing on large SUVs that are ‘too big and bulky for British roads’ but offer greater margins, says Transport & Environment.

The campaign group criticised auto makers for pricing a huge proportion of the nation’s drivers out of transitioning to electric cars in ‘pursuit of profits’.

Where are all the small, affordable EVs? A green think tank has criticised car makers for prioritising the sale of large battery-powered SUV models because they make more money on them

The arrival of smaller EVs could ‘help those on lower incomes gain from the benefits of using EVs as well as more efficient use of critical raw materials essential in efforts to achieve net zero,’ the green think tank claimed.

It says a YouGov poll of 502 adults conducted on its behalf last month revealed that the arrival of more affordable EVs would accelerate the transition to battery cars ahead of the 2030 ban on sales of new petrol and diesel models.

The survey found that a fifth (22 per cent) of new car buyers already intend to buy an electric car in the next year. 

However, when given the prospective option of a small £21,000 electric car, the share of British drivers willing to purchase an EV increased to three in ten (30 per cent).

Not including Citroen’s Ami quadricycle (which costs from £7,695 but has a maximum speed of 28mph and range of just 47 miles), the most affordable EV on the market today is the MG4, starting from £26,995 – and that’s a medium-size hatchback.

The cheapest small EVs currently in showrooms are the Mini Electric and Renault Zoe, both of which cost in the region of £30,000, meaning they are well beyond the budget of millions on British drivers.

Transport & Environment said car makers are ‘prioritising the production of vehicles that are just too big and bulky for British streets and are an increased strain on precious critical materials.’ Pictured: A Mercedes EQE and Audi e-tron 

An Audi e-tron and Jaguar I-Pace – both large electric SUVs – charging at Ionity devices

Ralph Palmer, electric vehicle and fleets officer at T&E UK, said: ‘Small, affordable electric vehicles are going to be vital to ensure that all drivers can leave behind their polluting petrol and diesel cars. 

‘And yet car makers are still prioritising the production of vehicles that are just too big and bulky for British streets and are an increased strain on precious critical materials.’

A study conducted by T&E in partnership with the Syndex consultancy calculated that manufacturers could sell small electric cars made in Europe for £21,000 by 2025 while still making a profit. 

This is thanks to falling production costs and battery prices that would make smaller models ‘feasible to electrify’. 

However, the big six European car makers – BMW, Mercedes, Renault, Stellantis, Volvo and Volkswagen – have ‘abandoned small affordable cars in pursuit of profits that have grown far faster than inflation’, with the biggest gains made from lucrative SUV sales.

T&E singled out Volvo in particular following its decision last month to kill off its existing saloon and estate car line-up to exclusively sell SUVs in the UK going forward. 

BMW’s £70,000 electric iX (right) dwarfs even its X5 SUV (left), which is a large family-size off-roader

Mercedes is one of the brands coming under some heat from the think tank. Pictured: The huge Mercedes EQS SUV, which costs from £130,000

Volvo confirmed last month that it will sell only SUV models in the UK with immediate effect, pulling its latest saloon and estate cars from British showrooms

Size difference: The BMW i3 (left) was one of the smallest EVs on sale before production ended recently. Here it sits alongside bigger electric SUV models from Mercedes and Audi

It says that more than two in five (44 per cent) of all new EVs sold in the UK in 2022 were SUV models as a result of brands failing to offer a wider range of vehicles to consumers. 

That said, just three of the top 10 best-selling electric cars last year were SUVs, with the Tesla Model Y and Kia e-Niro widely considered by many as ‘crossovers’. 

Yet the think tank warns: ‘This trend towards larger, heavier vehicles needs to be halted to lower the embedded emissions of vehicle production and reduce demands on the electricity grid.’ 

With the Government expected to introduce a Zero Emission Vehicle (ZEV) mandate from January – which will require mainstream brands to increase the proportion of EVs across total annual sales each year – the hope is that it will force the hand of manufacturers to bring more affordable electric models to market.

However, T&E wants to see the introduction of weight-based tax on the purchase of the heaviest new cars and for local governments to introduce parking charges for these vehicles in urban areas.

This comes a week after Bath and North East Somerset Council last week introduced ULEZ-style car park charges in the historic city where the most polluting vehicles have to pay more to use council-operated car parks. 

‘There are plenty of options on the table for the government, they just need to be bold and implement them,’ Palmer added. 

‘It is not a complicated argument – we are not going to be able to supercharge the appetite for electric vehicles by offering people expensive e-SUVs, we are only going to be able to supercharge the appetite by offering people affordable small EVs.’

The report has been published on the eve of the EU’s new investigation into low-cost Chinese electric cars said to be gaining an unfair ‘competitive edge’ thanks to their government-subsidised cheaper prices.

This post first appeared on Dailymail.co.uk