Renault Plans To Launch Electric Vehicles Priced Below $20,000

According to foreign media reports, Renault is expected to launch a new all-electric vehicle in the coming months, based on the iconic Twingo microcar from the 1990s. The car is positioned to compete with the BYD Dolphin, with an estimated starting price of around 17,000 euros (slightly below 20,000 dollars).

Renault believes it has found the key technological path to creating more affordable electric vehicle batteries. The company's newly launched lithium iron phosphate (LFP) battery is expected to reduce production costs by 40%, paving the way for a new electric vehicle priced under $20,000 that is attractive and not made in China.

Image source: Renault

According to the Spanish automotive news website Motorpasión, similar to Ford, Renault is adopting the cost-effective lithium iron phosphate battery technology. Compared to traditional lithium-ion batteries, lithium iron phosphate batteries not only offer higher safety and lower cost but also have a lower dependency on rare minerals.

Renault's decision is in stark contrast to the recent approach of European car manufacturers. Previously, due to the lower energy density of lithium iron phosphate (LFP) batteries and their slightly higher weight compared to nickel manganese cobalt (NMC) lithium-ion batteries of the same size, European carmakers have been "not very optimistic" about this battery technology. However, as Chinese automakers such as BYD, MG, and Leapmotor aggressively enter the European market with affordable electric vehicles equipped with LFP batteries, the "bias" against LFP technology is rapidly dissipating.

Nowadays, the advantages of lithium iron phosphate batteries in terms of stability, lifespan, and cost cannot be ignored, especially against the backdrop of continuous fluctuations in global lithium and nickel prices, which make it difficult for car companies to establish long-term business plans. However, Renault's choice to adopt lithium iron phosphate technology is more about catching up with Chinese car companies in terms of "cost-effectiveness" rather than simply pursuing technology. This signifies a consensus in the industry: the real barrier to the widespread adoption of electric vehicles is the price threshold.

This approach is also reflected in Renault's various strategic initiatives: whether it's the relaunch of the R5 E-TECH electric vehicle project or the announcement of the upcoming new Twingo model, the core logic behind these moves is to lower the price threshold.

Based on this consideration, Renault launched a new subsidiary, Ampere, in 2023, focusing on automotive software development. At that time, the brand set two clear objectives: first, to optimize the performance of Renault's "software-defined vehicles"; second, to reduce the manufacturing cost of new electric vehicles by 40%. It is not difficult to see that this cost reduction goal coincides with the effect that Renault can achieve by switching to lithium iron phosphate battery technology.