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What is the French Government’s proposal for low-cost leasing BEVs for EUR 100 per month?

France is promoting the BEV concept of long-term leasing at EUR 100 per month. At the end of February 2023, Prime Minister Bornu announced plans to start booking BEV leases by the end of the year and to deliver the vehicles by 2024. This is part of President Macron’s campaign pledge for re-election in 2022 as a low-income policy, with plans to introduce a public leasing scheme for EVs for EUR 100 per month to coincide with the expansion of EV production in the country.

What kind of vehicles will the BEVs to be leased for EUR 100 per month and what will the business model be? The specifics of the policy framework are unclear, but in today’s climate of rising energy and raw material costs, government financial support is seen as essential for the introduction of a leasing programme.

In the past, the Macron Government’s diesel fuel tax hike was an economic burden on low-income groups, causing radical ‘yellow waistcoat’ protests, but how will the industry respond to the low-income group’s low-cost BEV leasing programme of €100 per month? Will the industry be able to provide an effective product for the politically-driven, ideologically-driven, faster-than-expected BEV shift plan?

The new Peugeot e-208 (minor changes) to be launched in 2023 is priced at around EUR 40,000 (before applying the ecology bonus), while Renault plans to start production in 2024 of the new Renault 5, which it is developing as the next generation BEV, with a target price of EUR 20,000-25,000, a low price It is aimed at the €10,000s level, but not the €10,000s. Or will the Duo, a tandem two-seater to be developed for ridesharing, be used?

The Dacia Spring, the cheapest BEV in France, costs just over €20,000; perhaps in anticipation of a €100 lease, a €120 monthly leasing programme is being campaigned from January 2023. The problem is that it would not be possible without the government’s BEV purchase subsidy programme, and the Spring is a Chinese import: in its BEV strategy, Renault intends to build a BEV supply chain in France, and does not want to be dependent on China for the popularly priced BEVs it is introducing as a national programme. Renault does not want to be dependent on China for the introduction of a popularly-priced BEV as part of a national programme.

Germany, which has deployed BEVs starting with luxury cars because it considers it impossible to produce a BEV with sufficient performance at an affordable price with the current technology, and Japan, which has chosen a realistic solution that focuses on HEVs while limiting the volume of BEVs to a minimum. How will France establish a mass-brand low-priced BEV without relying on China, which has already established a mass production system? Will it utilise its Indian base for this purpose? We would like to pay attention to the future direction of the project.