Renault sees cheaper battery tech as key to keeping new retro EV affordable

PARIS -- Using a less-expensive battery technology could help Renault meet a target price of less than 30,000 euros ($36,000) for the Renault 5 small full-electric car, CEO Luca de Meo said.

Renault and rival Volkswagen have both said that they are aiming for a price of 20,000 euros to 30,000 euros for the next generation of small EVs, which would bring them in line with higher trim levels for current internal combustion models.

Renault's current small EV, the Zoe, starts at about 33,000 euros in France before incentives, as do full-electric versions of the Peugeot 208 and Opel Corsa. But even the highest-trim-level Renault Clio with a gasoline engine starts at 28,900 euros, and a base model is less than 16,000 euros. Clios with full-hybrid powertrains start at about 27,000 euros in France.

De Meo said in an interview with Automotive News Europe that the retro-styled Renault 5 could reach its price target by using batteries with lithium iron phosphate (LFP) cathodes, which have less energy density than batteries that use the more common nickel manganese cobalt (NMC) cathodes. at some point in its life cycle. That makes the battery packs heavier, but also less expensive. 

Batteries still make up around 30 percent of the total cost of an EV, although that figure has fallen in recent years.

Proponents say LFP batteries are also more stable, and less likely to overheat. They contain no cobalt, one of the most expensive metals involved in battery production. One reported drawback is reduced performance in cold weather, however.

VW brand is reportedly considering the technology for its coming small EV to be built on the group's MEB electric vehicle architecture.

De Meo said LFP battery technology, in combination with the automaker's CMF-B EV platform, could help it reach the cost target for the Renault 5, expected in 2023. 

"We are designing it to be a very competitive platform in terms of cost," he said. "That will allow us to sell cars in the heart of the market in terms of budget, say 20,000-30,000 euros, and still make money."

"We're three years away from (producing cars with) CMF-B EV," he said, "but we see the possibility of getting into the cost range that would allow us to sell an electric B segment (small) car at the same price of one with a combustion engine, maybe hybrid or PHEV." 

Tesla and China's BYD are among electric vehicle makers getting behind LFP battery technology, which is most popular in China among lower-cost EVs. Tesla has said it will use LFP batteries in a future vehicle that would cost less than 25,000 euros, and reportedly plans to use them in Model 3s made in China.
 
Apple is also reportedly considering LFP batteries for a future EV.

A report last autumn from analyst firm Wood Mackenzie said that technological improvements would help LFP batteries gain market share, both for industrial storage and for EV uses.

"Improvements in gravimetric energy density combined with cell-to-pack technology is the key to LFP now becoming a more attractive proposition in the passenger EV space," said Milan Thakore, a Wood Mackenzie analyst.  "Not only will cost and safety be a benefit, but OEMs won't have to worry about issues surrounding the supply of cobalt and nickel."