Another small car faces uncertain future: report

The car industry is in a period of transition as it responds to changing buyer habits and that means performance cars are under the microscope.

Another cult hot hatch is in hot water thanks to Europe’s tough new emissions laws.

A report by UK publication Auto Express has revealed that the Renault Megane — which spawns the cult RS model — could be on the chopping block.

Auto Express spoke to Renault’s chief designer, Laurens van den Acker, who said the small car may not be renewed at the end of this generation.

The future of the Renault Megane is up in the air.

The French car maker is increasingly focusing on electric cars and the money required to update and engineer a new small hatch could be better spent elsewhere.

“The Megane is in a segment that’s increasingly under pressure. You have to put your money where the future of the market is,” said van den Acker.

In Australia Renault has sold less than 100 Meganes through the first three months of this year. Close to 8000 Toyota Corollas found a new home in that same period.

The Megane RS Trophy-R is the brand’s most hardcore machine.

The axing of the Megane would also spell the end of the cult Megane RS Trophy hot hatch. The front-wheel drive hatch has been an enthusiast’s favourite since its launch in 2004, taking the fight to Volkkswagen’s benchmark Golf GTI and Subaru’s popular WRX.

Earlier this month Ford confirmed the axing of the popular Focus RS hot hatch because it would cost too much money to engineer it to meet increasingly strict European emissions standards.

Small cars are increasingly on the nose as new car buyers flock to SUVs and utes.

In 2019 Australians bought about 35,000 fewer small cars than in 2018, which is a decline of 18 per cent.

Ford has axed the hardcore Focus RS hot hatch. Photographer Mark Bean.

This trend has continued through the first three months of this year. Australians bought 7000 fewer small cars through March this year than in 2019, which is a drop of about 16 per cent.

Several brands — including Mazda and Toyota — have deleted entry-level small hatches and instead focus on selling more expensive and well-equipped versions instead of chasing sales volume.

In America brands such as Ford have stopped selling hatches and sedans altogether as they focus on SUVs and pick-up trucks.

Small hatches historically have very small margins and with car makers under pressure to boost profitability they are instead focusing on more larger vehicles.

Car makers are being forced to collaborate to spread the cost of developing some new vehicles.

There has also been an increase in brands collaborating and sharing the cost of developing new vehicles.

Toyota teamed up with BMW recently to build the new Toyota Supra and BMW Z4 sports car twins. Both use BMW engines and transmissions.

Ford and Volkswagen have agreed to partner to build new commercial vehicles, including new utes and vans, while Mazda and Isuzu are jointly developing their next-gen dual cab utes.