PARIS (Reuters) - Flexis, a joint venture between automaker Renault (EPA:RENA) and truck maker Volvo (OTC:VLVLY) Group as well as shipper CMA CGM, said on Tuesday it has received letters of intent from 10 European transport and distribution companies for orders of 15,000 units of its new electric van.
The letters of intent were signed with France's Colis Privé, a unit of CMA-CGM, UK-based Hived and Germany's DB Schencker and will add to sales for Renault and Renault Trucks (Volvo) brands. Other potential customers who signed letters have not been disclosed.
WHY IT'S IMPORTANT
Europe needs more electric vans to meet the demand for a rise in parcel deliveries in city centres where restrictions are increasing on petrol and diesel vehicles.
Automakers also need to meet tighter targets on carbon emissions, which are more difficult to achieve for vans than for cars because they are heavier and there are few commercial vehicles specially designed as electric, apart from those offered by U.S.-based Rivian (NASDAQ:RIVN).
BY THE NUMBERS
Of the total 1.6 million new registered vans in Europe last year, only 6.1% were electric, less than the 7.2% in 2023, according to data published on Tuesday by the European auto lobby group ACEA (BIT:ACE).
KEY QUOTE
"Change is always slow at the beginning," said Philippe Divry, managing director of Flexis, during a press briefing.
"But as soon as someone brings a product that is realistic, economically and operationally, from that point customers will switch quickly," he added.
"The target for CO2 reduction is just as ambitious as for passenger cars, but the offering is still too limited. The market for electric light commercial vehicles is not taking off; it has even shrunk in 2024," said Antoine Giraud, auto analyst at S&P Global.
CONTEXT
Carmakers are currently lobbying the European Commission for more flexibility on its tighter CO2 emissions targets for the auto sector given the slowing demand for electric vehicles.
Talks will kick off on Thursday in an effort to reach a compromise.
(This story has been corrected to change the manufacturer to Volvo Group, not Volvo, in paragraph 1)