Calls for Europe to create own kei car law for small, urban EVs

European automotive lobby group ACEA has called for the introduction of special regulations for small, urban-centric EVs to create a version of Japan’s kei car segment.

Kei (short for keijidosha) is a specific category of cars in Japan whose small size and 660cc maximum engine displacement are regulated by the government to force car makers to design vehicles more suitable for cramped urban environments.

“The kei car is a perfect example of the kind of things we should be able to do,” said Luca de Meo, Renault Group CEO and ACEA president, at a presentation to outline a new manifesto designed to persuade law makers to soften some of the more onerous European Union regulations coming down the line.

Small electric cars in this proposed new category should have a reduced purchase tax, lower road tolls, easier access to city centres and not be subject to the same parking restrictions as regular cars, de Meo said.

Car makers in recent years have faced increasingly complex regulations that apply equally to both small and large cars, pushing up size, weight and cost. “A- and B-segment cars are not profitable any more because auto makers have to produce cars dressed up like Christmas trees,” de Meo said. “It doesn’t make a difference if it’s a Clio or a big limo.”

Renault last week unveiled its new Twingo, a small EV, which it says will be on sale in 2026 for cost of under €20,000 (roughly £17,250). In the proposed new kei class, battery size could be smaller or even restricted to ensure costs were kept low and customers paired the car to their needs.

De Meo quoted the average journey profile of the Dacia Spring of 19 miles a day at an average of 16mph. “So you don’t need a 100kWh battery, which is an ecological disaster anyway”, he said.

Japan’s kei class has grown to around 40% of the country’s car market and, with a few exceptions, the models produced have stayed in the country. Interesting examples include the Honda Beat, Honda S660 and Suzuki Cappuccino, but most are miniature squared-off people carriers such as the Honda N-Box, which is Japan’s best-selling car to the end October this year, at 190,608 units, according to figures from car sales aggregator bestsellingcarsblog.com.

The Honda N-Box

Small electric city cars have become a recent sales sensation in China after manufacturers returned to the sector with much more sophisticated models than had been produced in the past. Examples include the formerly best-selling Wuling Hongguang Mini EV, Wuling Bingo and Geely Panda Mini.

Car makers in Europe have in the main either left or are about to leave the city car sector due to a combination of rising regulatory costs and the inability to cheaply reduce CO2 in combustion-engined models. Axed cars include the Seat Mii, Skoda Citigo, Ford Ka, Vauxhall Viva, Peugeot 108 and Citroën C1.

The switch to EVs addresses the CO2 problem, but the cost of batteries is still too punitive to create a wide enough choice in the affordable segment. Restricting battery size and cutting the regulatory burden would offset those costs, meaning car makers could make money again with an affordable vehicle, de Meo told journalists. “We think we can propose something [that] addresses the usage without the cost of a car that has to do everything,” he said, without mentioning which regulations ACEA would want watered down. 

Countries across Europe permit small ‘quadricycles’ to be driven in some cases without a licence, although speeds are limited. For example, the Citroën Ami has a maximum top speed of 28mph.

De Meo said that regulation in the European Union for car makers had become such a burden that an estimated 20-25% of Renault Group engineers were working on satisfying those regulations.

Creating a category of small, lower-cost EVs would help car makers lower their CO2 burden in the run-up to ending sales of fossil-fuelled combustion-engine cars in 2035. 

De Meo said it was an example of the industry “proposing solutions rather than defending positions”.