As European car manufacturers face pressure to meet new EU emissions goals, they are turning to price hikes to help make electric cars more attractive to customers, reports Boosted.
The EU aims for electric vehicles (EVs) to make up 20% of car sales from January 1. If this goal isn't met, car manufacturers could face hefty fines.
In response, many car brands have raised prices on their gasoline and diesel vehicles.
Stellantis, Volkswagen, Renault, and Audi are among the companies that have increased prices on certain models by hundreds of euros in recent months.
For example, Peugeot raised the price of all its models in France (excluding electric cars) by up to 500 euros in November, which is roughly 500 US dollars.
According to Denis Schemoul, a car analyst at S&P Global, these price hikes could help fund future discounts on electric vehicles.
So far, electric cars make up just 13% of total car sales in the EU this year. Some politicians are pushing to ease the 2025 goals, warning that the car industry could face fines up to 15 billion euros (around 15 billion USD).
To avoid such penalties, many manufacturers are planning to combine their emissions quotas with other brands.
For example, Suzuki will join forces with Volvo in 2025 to meet the requirements.
Next year, several new, supposedly cheaper electric cars will be launched in Europe, including models like the Hyundai Inster, Fiat Grande Panda, BYD Seagull, Cupra Raval, Renault R5, Skoda Epiq, and VW ID.2.
Additionally, more electric cars under 25,000 euros (around 25,000 USD) are in development, such as the new Renault Twingo, Kia EV2, and VW ID.1.
However, a source close to one of Europe's major car manufacturers told Reuters that simply raising prices on gasoline and diesel cars might not be enough to boost electric vehicle sales.
The growth in the electric car market remains slow, and it remains unclear whether these efforts will significantly increase EV adoption.
