The race is on for car-makers to develop electric models priced under €25,000 in Europe

PARIS: With the automotive industry's energy transition, carmakers are now faced with two major challenges.

First is the 2035 cutoff for selling combustion-engine vehicles in Europe.

Second is the impending influx of new, inexpensive Chinese vehicles.

This is why several projects for compact electric cars priced under the symbolic €25,000 (RM120,000) mark are soon likely to see the light of day.

In Europe, apart from the Dacia Spring and the Renault Twingo E-Tech, which can be considered as "low-cost" vehicles, electric cars like the Renault ZOE, the Peugeot e-208 or the Fiat 500 can require a budget of nearly €30,000, once environmental subsidies are taken into account.

Obviously, if you're looking to buy a sedan or an SUV, the cost can rise much higher.

A Volkswagen concept car

Faced with the impending influx of Chinese electric vehicles, Europe's big car brands need to bring out models that offer performance and reliability, while also being more affordable. Several projects for lower-cost compact cars, starting at €25,000 or under, are now well underway. For car manufacturers, it all usually starts with a concept car.

This is the case at Volkswagen, which recently presented its new ID. 2all concept, a forerunner of its future compact electric car, expected to be available in 2025.

The brand's aim is to offer a car that's as spacious as a Golf and as affordable as a Polo. The ID.2 will be equipped with a number of high-tech features, such as the Travel Assist system for partially automated driving, and LED lights that adapt their intensity and range to each situation (IQ.Light technology).

It will also be the very first model to be based on the new "MEB Entry" modular electric drive platform. Volkswagen has announced the presence of a 166 kW (226 hp) electric motor. In terms of range, the future ID.2 should be able to cover nearly 450 kilometers on a single charge.

An electric Renault 5 still in the pipeline

Note that Skoda and Seat, which will benefit from the same platform, will also offer competitively priced models in the near future. But the Volkswagen group is obviously not the only one working on a 100% electric car that promises performance at a (relatively) low cost. Renault, a pioneer in all-electric vehicles, is on the same page, with a project that is steeped in nostalgia.

Indeed, Renault is seeking to revive the legendary R5. In 2021, the French carmaker unveiled a prototype electric car directly inspired by the R5, featuring a modern yet retro look embodied by a contemporary design refresh, a surprising headlight design and a recharging hatch placed under the hood's air intake.

The future Renault 5 electric is expected by 2025, at the latest, at a highly competitive price, probably under €25,000 in its basic version.

Tesla's secretive project

Europe's 'historic' car-makers aren't the only ones looking to push down prices, as so is the e-car company Tesla. In fact, a Tesla priced at just $25,000 -- or about the same amount in euros -- could soon see the light of day.

This Model 2 (or A, or C, depending on the source) is expected to be a more compact version of the current Model 3, built on a brand-new platform and equipped with a smaller battery. I

t could be produced in Tesla's Shanghai factory, in China, which is the only way the American carmaker can really drive down the price. However, this project has not yet been officially confirmed.

The aim of these manufacturers is to offer an increasingly wide range of vehicles to satisfy all budgets, even the most "modest."