Last year, Linda Jackson took on the leadership of PSA Group's low-emissions vehicle business unit. That means in addition to her duties as CEO of the Citroen brand she is tasked with making sure the company is compliant with stricter emissions regulations. Jackson explained how electrification will help the group meet those targets in an interview with Automotive News Europe Associate Publisher and Editor Luca Ciferri and Correspondent Peter Sigal.
Will electric vehicles always be more expensive than internal combustion models because of the battery cost?
You can't simply look at the cost of the battery or the cost of the car. For the customer, the total cost of ownership (TCO) is the real measurement. You need to take into account that electricity is cheaper than fuel. If you look into the future, there will come a time when the TCO for an electric car is equal to or even better than a gasoline or diesel model. Even now, we are trying to make sure those costs are about the same because, otherwise, what's the advantage for the customer in buying electric?
What is PSA's strategy for meeting its 2020-21 EU emissions target?
It's not just about the fact that we want to avoid paying penalties. It's also ethical: We have a corporate responsibility as a global company to meet those targets. Our strategy is comprehensive, and we are working on all fronts. First, we have set ourselves a target of around 7 percent of our sales being LEV [low-emissions vehicles, meaning full-electric vehicles and plug-in hybrids] by 2020. It's also the mix of gasoline and diesel sales. And it's technological as well. We have worked to make our platforms lighter, which also helps to save CO2, and we are trying to make our gasoline engines more efficient.
Diesel sales are declining less than many people expected. Given that, do you still need to sell 7 percent low-emissions vehicles?
The percentage of diesel new passenger cars in the EU is about 30 percent and has been stable for the past six months. Is that going to move down 10 percentage points by the end of next year? Nobody knows, but having that 7 percent target lets us manage that uncertainty.
How much of that 7 percent will be EVs versus plug-in hybrids?
At the moment we have seen an increase in EV and plug-in hybrid sales, but that could change overnight because of incentives. The customer is very much led by incentives. We will stick to our overall target of 7 percent, and we will manage that as the market moves.
What are the sticking points preventing consumers from buying EVs and plug-in hybrids?
For a manufacturer, it's about educating people about what electric cars are. PSA is launching lots of new electrified vehicles next year, but at the same time we are launching a suite of services that will show you where you can park, where you can charge, real-time range and other things through your smartphone. We need those services to address the concerns that people have. For example, one customer asked if he could charge his vehicle when it rains. Once people get into an EV, they love it, but you have to take away their fears, some of which are real. We need to have a very simple, clear message that it's not just about having an electric car but how do you live with one.
How much of the cost of emissions compliance can you pass on?
The cost of doing business at the moment is electrification and autonomous cars and driver assistance technology. To survive you need to invest in all of these things. The question after that is: How much can you charge your customers? Let's be honest: an electric car or plug-in hybrid costs more. [PSA Group CEO] Carlos Tavares has compared those costs to paying more for organic food. I think that comparison makes sense.
What is Citroen's electrification strategy and timeline?
We will launch the C5 Aircross plug-in hybrid next year. After that we will launch a new C-segment [compact] car with a full-electric variant.
Will that car be the first EV on PSA's EMP2 platform or will it be based on the CMP architecture?
It's on the E-CMP platform, so it's the first C-segment car on the CMP platform. It will replace the C4 Cactus, which is also on a stretched B-segment [small car] platform, for us in Europe. It's a very important launch. Starting next year every model we introduce will have either plug-in hybrid or a full-electric version, depending on the platform, as well as diesel and gasoline variants -- as long as diesel is relevant. By 2025, 100 percent of our range will have electrified versions. That includes light-commercial vehicles, which make up 20 percent of our sales.
What are Citroen's goals for expanding outside of France?
It's the second part of our journey. We have consolidated in Europe and increased our sales. Now we need to be more international. There are three parts to our growth plan. We still have aspirations to grow in Europe, where we have a 4.8 percent market share and want to get that to more than 5 percent. The second is that we are rebuilding our operations in China. It's our No. 1 market outside Europe, so we have to do it. The third is new frontiers, starting with India. We are developing a line of vehicles for India that we call "C Cubed" for Cool, Comfort and Clever. They will be manufactured in India, starting in 2021, and we will have more than 90 percent local integration. It's a completely new vehicle program, and we will adjust it for other markets.
Is this PSA's answer to Dacia?
No, and this is no disrespect to Dacia. These vehicles will have the same elements as a Citroen, with a unique and attractive design as well as comfort features relevant to that market. The way we can make it cost effective is to build it in India or other markets.
Will the vehicles appear as other PSA brands?
No, C Cubed is a Citroen program.