John Elkann says Europe needs small, affordable cars like Japan's 'kei cars'

Europe needs small and affordable cars such as Japan's “kei cars”, Stellantis chair John Elkann said on Thursday, as high prices, which he blamed on regulation in the region, weigh on consumer demand.

Kei cars are urban vehicles traditionally sold in Japan with size and engine restrictions, enjoying lower tax and insurance costs. Elkann said the European equivalent could be called the “e-car”.

“There's no reason, if Japan has a kei car, which is 40% of the market, Europe should not have an e car,” he said at an Automotive News Europe conference in Turin, Italy, the home of Fiat, now part of Stellantis.

Fiat has a tradition of making small, affordable cars, from the “Topolino” of pre-war years to the famous “600" and “500" of the 1950s and 1960s, which helped Italians take to the roads and turned Fiat into a European giant.

Elkann noted that in 2019 there were 49 models sold in Europe for less than €15,000 (R266,622), vs just one now. In 2019 a million cars were sold at that price level compared with fewer than 100,000 now, he added.

“If you look at the [cars'] cost increase, that has primarily been driven by regulation,” Elkann said.

He is still steering Stellantis as newly appointed CEO Antonio Filosa formally takes the job later this month.

Filosa, an Italian, led Fiat Chrysler and Stellantis' operations in South America before being appointed head of the carmaker's key North American market last year.

Elkann said Filosa was the right choice in an automotive industry shifting from being global to “multi-regional”.

“The experience Antonio had running Argentina, Brazil, South America and recently running North America is in phase with how the world is going between regulations, tariffs and how you navigate that constructively with political forces.”