Small 'e-cars' could soon be on European roads, as the car industry fights back against Chinese dominance and cut-price motors.
European Union President Ursula von der Leyen is proposing to 'work with industry on a new small affordable cars initiative' that will be loosely based on Japan's 'kei car' class.
The European version of the Japanese small car category was first suggested by Stellantis chairman John Elkann and former Renault Group chief executive Luca de Meo in July as a way to offer drivers cars that are cheaper to build, emit fewer lifecycle emissions and have lower safety regulations.
Kei (Keijidosha) cars are 'light automobile' with tight propulsion and dimension rules - they have to fit within a box that's 3.4 metres long, by 1.48 metres wide by 2.0 metres tall.
Kei car regulations originated in 1949, and have been updated over the years. Today's limits were introduced in 1998. Innovation and originality are at the forefront of success in this segment - a segment that hasn't changed its dimensions or power rules for 27 years.
By taking up this small car approach, the EU is fighting back against cheap rival electric cars coming from Asia with von der Leyen stating: 'We cannot let China and others conquer this [small car] market.'
The Small Affordable Cars initiative comes after Stellantis boss Jean-Philippe Imparato demanded that the EU relax regulations around smaller cars so manufacturers can profitably develop and build a €15,000 (£13,000) electric car with a 70-mile range.
In response, during her State of the Union address von der Leyen said: 'Millions of Europeans want to buy affordable European cars, so we should also invest in small, affordable vehicles, both for the European market but also to meet the surge in global demand.
'This is why we will propose to work with industry on a new small affordable cars initiative.
'I believe Europe should have its own e-car.
'E for environmental – clean, efficient and lightweight.
'E for economical – affordable for people.
'E for European – built here in Europe with European supply chains.
'Because we cannot let China and others conquer this market.'
Ways the e-cars could be made affordable include exempting some ADAS equipment, such as lane keeping assists.
ADAS systems are some of the most expensive to produce but manufacturers can't increase on the road prices sufficiently to cover the cost of this kit.
Commenting on von der Leyen's words, Stellantis told Daily Mail: 'Affordable mean cleaner air, safer roads, increased industrial production, and faster decarbonisation.
'Excessive regulation has driven up costs, making these cars almost impossible to produce profitably.
'President von der Leyen’s initiative is both visionary and urgent. Now it’s time to turn ambition into action.'
Stellantis found that there were 49 sub-€15,000 cars on sale in 2019, but that figure fell to just one in 2025.
The EU is targeting a stringent internal combustion ban for 2035, but manufacturers are calling for relaxed regulations which would include evaluating the lifecycle CO2 emissions of vehicles, instead of just measuring tailpipe emissions.
Car makers would then be able to continue to develop different powertrains while still reducing CO2 emissions.
While this new category of car is good news for Europe's automotive industry, and could help it stay afloat in the face of increasingly challenging competition and laws, this kind of legislation takes years to come into effect so it's unlikely E-cars will be on sale for a while.
