Are Frugal Minicars the Future of Urban Mobility?
Urban mobility has been undergoing a major transformation in recent years with the development of ride-hailing and micromobility, an emerging shift from ownership to ridership as well as electrification across all modes. In 2022, battery EVs (BEV) represented about 5% of new vehicle sales in the USA, 12% in Europe and 22% in China. The industry, however, seems to try and replicate with BEVs some of the characteristics of current vehicles, in particular their form factor and range despite what this means for battery supply chains and vehicle weights.
A new category of vehicles has recently emerged in Europe, China and to a lesser extent the USA that are purpose-designed for urban use — the closest category in Japan are “kei cars”. They typically offer seating for two, a range of 100-150 km and a very small footprint (less than 3m long which helps congestion and parking) with a cost of $5-15k. Why do these frugal, minicars make sense and can they go mainstream?
BEV Offering Diverge in Size and Battery Capacity
The USA and China offer very contrasted BEV markets. The former is home to GM’s absurd Hummer EV. Its 210-kWh pack provides the 4-ton+ SUV (of which about 1.3t just for the battery) an estimated range of 480 km or 300 miles EPA. Similarly, Rivian’s SUV offers a standard battery pack of 135 kWh good for 505 km (316 mi. EPA) — a 180-kWh pack is in the works.
At the opposite end, the Chinese BEV market is dominated by the tiny Wuling Mini EV produced by SAIC-GM-Wuling (yes, a 44% GM partnership) which falls in the local A00 category. In 2022, 554k units of this $5k minicar were sold. They are fitted with a 9 or 14 kWh pack, 170 km top range and 2+2 seating capacity — a true urban car.
Despite these extremes, most vehicles sold in both markets and in Europe are fitted with battery packs ranging essentially between 40 and 80 kWh resulting in 250 to 500 km EPA range. Large vehicles (e.g., Tesla Model S, Mercedes EQS) get up to 100-110 kWh packs delivering up to 800 km of EPA range.
Some Efforts to Match Vehicle Size with Actual Needs
The ranges outlined earlier exceed what a regular use requires assuming one can charge at home, at work, or while shopping — this is particularly true in urban settings. Indeed, 46% of all trips undertaken in the USA are under 5 km and 77% below 16 km. Does it make sense to constantly carry a heavy battery pack for the 5% of all trips that exceed 50 km?
There is room for more frugal vehicles that are lighter thanks to a more compact form factor and a much smaller battery pack. Norway, with its 71% BEV penetration in 2022, seems to be pushing its own market in this direction with a new tax scheme. As of January 2023, BEVs will be taxed 12.5 NOK (1.15€) for every kilogram over 500 kg of vehicle weight. For a VW ID.4, for instance, this translates into a tax of 1,700€ for the 52-kWh version vs. 1,900€ for the 77-kWh one. In addition, a 25% VAT is now applied to the portion of a BEV’s price above 500k NOK (45k€).
Whereas Norway is promoting lighter, less expensive BEVs, last summer the USA’s Congress passed the Inflation Reduction Act which tends to go in the opposite direction. Even if the IRA clearly amplifies the industry’s electrification efforts, I find it absurd that it favors larger, heavier vehicles. Indeed, the same incentive of up to $7,500 per vehicle will be offered for SUVs and light trucks up to $80,000 vs. $55,000 for sedans. This will lead to a higher usage of batteries and raw materials in general — and promote vehicles that are known to be more dangerous to other road users.
Frugality by Design
Reducing a vehicle’s size and mass in general has a positive impact on its overall design requirements. This process leads to a virtuous cycle whereby a lighter vehicle allows for smaller chassis and powertrain components (brakes, suspension, motor, battery for a given range etc.), which in turn makes the vehicle lighter.
Renault Group’s Dacia Spring is an excellent example of a frugal vehicle. The small, battery electric SUV (3.73 m long) features a curb weight of only 970 kg. As a result, its 27 kWh battery powers a 33-kW motor over a WLTP range of 225 km while seating 5 people. This 20k€ (incl. VAT) frugal vehicle proves the potential of a constrained engineering solution. This is not yet the ideal urban vehicle.
Are Minicars the Future of Personal Urban Mobility?
In 2012, Renault introduced the Twizy. This very light (473 kg) 2-seater features a 6-kWh battery pack good for 120 km of WLTP range and a top speed of 80 km/h. Priced at 12,300€ in France, this was the first car which teenagers aged 14 to 16 — depending on the European country — could drive without a license (45 km/h version). Twizy’s future successor is shown at the top.
A series of similar, low-priced, compact vehicles, a.k.a. minicars, has emerged in the last couple of years which show what may become the de-facto solution to address most urban mobility needs. They almost all offer only two seats either in tandem or side-by-side, are mostly priced between 8 and 15k€. They feature a WLTP range of 75 to 200 km thanks to battery capacities of 6 to 14 kWh.
Introduced in 2020, Stellantis’ Citroën AMI (see above) replicated the same approach with a side-by-side, two-seater EV priced at 7.8k€ (incl VAT). The minimalist EV targets teens and other people without a license with performance that meet urban needs, i.e., 75 km range with a 5.5 kWh battery.
Most of the vehicles in this segment offer a version which does not require a license in Europe as they qualify for its L6e or “light quadricycle” classification. This means a maximum curb weight of 425 kg, power below 6 kW and a top speed of 45 km/h. Versions certified under the L7e category are also typically offered. While they require a standard driver’s license, they bypass most crash test requirement in exchange for a top speed capped at 90 km/h and power limited to 15 kW.
In the USA, there is no classification equivalent to L6e, but one exists for L7e. “Low Speed Vehicles” have a speed limit at 40 km/h (25 mph) and a maximum gross vehicle weight of 1135 kg (2500 lbs). Vehicles in this category are typically derived from golf carts, e.g., the Polaris GEM e2 offering 160 km of range with up to 12 kWh of battery capacity powering a 5-kW motor.
Whereas the market for license-free vehicles (L6e) is likely driven by Gen Z’s decreasing interest in obtaining a driver’s license, the market for more powerful versions (L7e) should grow thanks to the shift from vehicle ownership to ridership. These vehicles will likely be largely deployed in shared fleets in urban environment. Some of these minicars may even be specifically designed for this purpose such as Circle’s EV (see above) which will be first deployed in a shared fleet in Paris in late 2023.
These vehicles are not cheap EVs. Their low price is made possible thanks to constrained characteristics that are sufficient for personal urban mobility while their design is generally pleasing. Worthy examples of such vehicles are the Microlino (Switzerland, see below), XEV Yoyo (Italy), Silence S04 (Spain), Eli Zero (USA), Triggo (Poland), City Transformer (Israel) or Nimbus One (USA).
Fifteen thousand L6e and L7e vehicles were sold in Europe in 2022 according to IDTechX’s estimate, up from 9k in 2021, boosted by Citroën AMI’s sales. One imagines these vehicles becoming common in Europe’s dense city centers, it is a less the case in the USA, except possibly in places such as New York City, Los Angeles or San Francisco. Time will tell.
Managing Director, Orsay Consulting
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