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Renault has become the latest EV group to place itself on a war footing with Chinese Tesla-killer BYD, and the French carmaker\u2019s boss is harking back to the 1940s for a plan to help Europe\u2019s carmakers fight off rising threats from the Far East.<\/p>\n
In a 19-page open letter<\/a> addressed to Europe, Renault boss Luca de Meo warned the continent was facing an \u201conslaught of electric vehicles from China\u201d and needed to take inspiration from China itself, as well as the United States, to kickstart EV takeup.<\/p>\n Now de Meo is calling for a European fund to help speed up Europe\u2019s transition to electric vehicles before Chinese EV maker BYD takes over the market.<\/p>\n \u201cA European Marshall Plan could be put in place to accelerate \u2018parc\u2019 renewal and thus drastically reduce CO2 emissions,\u201d de Meo wrote, referring to the number of EVs on the road.<\/p>\n The Marshall Plan<\/a>, known as the Economic Cooperation Act, was passed by the U.S. Congress in 1948 to help rebuild Western Europe in the wake of World War Two, partly out of fear of Communist expansion.\u00a0<\/p>\n The act would eventually see $12 billion funneled across 16 countries over three years.\u00a0<\/p>\n The French carmaker\u2019s boss appears to be hoping for something similar for the EV market, which is at something of an inflection point.\u00a0<\/p>\n Carmakers appear to be running out of early EV adopters<\/a> and are now turning their sights toward mass-market internal combustion engine drivers, who have been more reluctant to make the shift to EVs.<\/p>\n Several automakers<\/a> have warned it will take longer than initially thought to convert those stubborn drivers to EVs, citing everything from falling gas prices to inadequate infrastructure.<\/p>\n Renault\u2019s de Meo warned that oppressive regulations in Europe were increasing the cost and lifespans of carbon-emitting vehicles by an extra five years since the 1990s.<\/p>\n The U.S., on the other hand, had backed the uptake of EVs in the country through its mammoth Inflation Reduction Act, which pumped billions of dollars into the market.<\/p>\n The Renault boss mentioned China 23 times in his brief letter, underscoring the anxiety coursing through Europe\u2019s legacy automakers amid a push into their market by BYD.<\/p>\n Warren Buffett-backed BYD has benefitted from state-backed subsidies in China. It also has complete control of its battery supply chain, which has helped massively reduce costs.<\/p>\n De Meo pointed out that a C-segment car in China had a cost advantage of between \u20ac6,000 and \u20ac7,000 (between $6,500 and $7,600) compared with a European equivalent.\u00a0<\/p>\n That cost advantage has helped BYD make early inroads into the European market, agreeing to build a new manufacturing plant<\/a> in Hungary and sending purpose-built EV cargo ships<\/a> that can carry 7,000 BYD cars to the continent.<\/p>\n There are obstacles<\/a> that make BYD\u2019s advance in Europe far from assured.<\/p>\n The group will have to contend with European drivers\u2019 brand loyalty, higher labor costs, and the threat of a clampdown from lawmakers.\u00a0<\/p>\n Indeed, the EU has already launched a probe<\/a> into BYD over potentially anti-competitive Chinese subsidies, which has left carmakers in a \u201cstate of shock.\u201d<\/p>\n Despite also fixating on the threats of China, De Meo pointed out that it was important Europe maintained relations with the automaker, which has become a valuable trading partner to some of the continent\u2019s biggest economies.<\/p>\n \u201cCompletely closing the door to them would be the worst possible response,\u201d de Meo wrote.<\/p>\n<\/div>\nEurope\u2019s BYD threat<\/strong><\/h2>\n
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