The Cost of Driving: Why Small Cars are Getting Pricier and What the Euro 7 Standard Means for the Future of Driving in Europe
In recent years, the prices of the most affordable cars in Europe have seen a significant increase, according to an analysis of five of Europe's largest car manufacturers by the non-governmental organization Transport & Environment (T&E). Since 2019, prices have risen by an average of 41%, nearly double the total inflation over the same period.
This phenomenon is attributed to various factors, including more expensive parts and a rise in labor costs in the automotive industry. Interestingly, this price hike comes at a time when the European Parliament is deliberating on the implementation of the Euro 7 standard, a stricter regulation aimed at making cars cleaner and more environmentally friendly.
T&E claims that the automotive industry has hindered the adoption of the Euro 7 standard using misleading arguments. According to T&E, the proposed standard, which aims for a substantial reduction in air pollutant emissions, would cost only 200 euros per car. However, this seems not convincing enough for car manufacturers, who argue that complying with the Euro 7 standard is financially unfeasible.
A detailed analysis of the price increases reveals some shocking figures. Models such as the Peugeot 208, Seat Ibiza, and Renault Twingo have seen price increases of nearly 6,000 euros, ranging from 37% to 56%. The Mercedes A- and B-class models have become over 10,000 euros more expensive, equivalent to an increase of about 37%.
The price hikes are explained by the rising costs of parts and labor, but the fact that this increase is almost twice as high as inflation raises questions. T&E emphasizes the cynical contrast between these price hikes and the recent opposition of car manufacturers to the Euro 7 standard. The new standard, intended to improve air quality by reducing emissions of harmful substances such as particulate matter and nitrogen oxides, was originally set to take effect in 2025 for cars and two years later for buses and trucks.
However, due to intensive lobbying by the automotive industry, these deadlines have been pushed back by several years. The revised and watered-down proposal has already been approved by the Environment Committee of the European Parliament. In addition to the known goals of reducing nitrogen oxide and particulate matter emissions, the Euro 7 standard now also includes regulations regarding the emission of plastic particles and fine particles resulting from tire and brake wear.
This broader approach aims to significantly improve air quality and thus reduce the annual premature deaths due to air pollution from road transport. It is estimated that in Europe, 70,000 people die prematurely each year due to this form of pollution.
While the Euro 7 standard seems to be a step in the right direction for a cleaner and healthier future, the recent increase in car prices raises the question of whether these improvements will be accessible to the average consumer. The debate over the cost of environmental measures versus the affordability of vehicles seems to be in full swing. It remains to be seen how the European Parliament will decide and how the automotive industry will respond to this new regulation.
