Is the budget car falling out of favor?

The Kia Picanto, Renault Twingo and Peugeot 108: these wildly popular cars from the A-segment are likely to become a lot more expensive. You can currently buy these cars new for around 12.000 euros. In 5 to 10 years, these city cars may cost a quarter more.

CO₂-emissions down, price up?

This has everything to do with the rise of the electric car and the European Union's rules to reduce CO₂-emissions. Because even the most economical, environmentally friendly cars cannot meet these emission requirements, car manufacturers are turning en masse to the development of electric and hybrid vehicles. And they are simply more expensive to produce.

In addition, certain safety features, which will be mandatory from 2021, are already increasing production costs.

Small and compact cars hit hardest

A hybrid drivetrain in a new car costs around 3000 euros. A more expensive car therefore only increases in sales price by a few percent. In the case of a city car, this amounts to a price increase of around 25 percent. These are therefore expected to fall out of favor with the price-conscious consumer.

Car manufacturers anticipate this by ceasing production of these models. The Peugeot 108 and Citroën C1 are already doomed. Also other cars from the A-segment – and even the B-segment – ​​face an uncertain future.

Temporary price increase?

If the production costs of electric cars gradually decrease, you should see that reflected in the sales price. It is therefore not unthinkable that these types of cars will make a comeback. But that is not expected to happen for another ten years or so. In the meantime, drivers with a smaller wallet will have to rely on the supply of used city cars.

But given the market forces and the decreasing supply versus an increasing demand, the price tag attached to a compact used car will also increase. The small cars that remain – new or used – will therefore become a lot more expensive anyway.

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Are you currently driving a city car? What does this possible (price) development mean for you? Let us know in a comment. A rent a car in the Urmond region can be done at Adrem Car Rental.